Focus on companies that grow revenue amid the downturn, says Kevin Kelly of Recon Capital Partners. He likes PayPal, Google, and some biotech stocks.
Stocks tracking oil prices Thursday giving back much of earlier gains with a in the studio for analysis Kevin Kelly. He's the IO recon capital partners welcome back Kevin now productivity factory orders falling jobless claims rising more than expected. Arm is at all besides oil is an economic team have you damper on the market. There's a little bit of that over. You know it means that the team members like people are thinking that the Fed will be race in the four times indicated so. It's getting back to. It's good news that users could use that right because if we give it a lot of good news than that raise rates but on the converse side that's happening now if we keep getting batteries that could be good for the markets is that the vote won't raise rates further as they do rates count and you know financial stocks. I'm taking a shellacking in the market perhaps because people think well fed me the race. The wartime some people that the third and what's your take on the financials. While the financial sectors what large sectors of the S&P 500 we do have a good growing economy should leave the way for us. Going for the scene and one of the reasons why is because we've seen rates. Not independent of that go down so if you look at the ten year treasuries indicating slower growth happening here in the United States. So there is that over me as well as we haven't seen a budget defaults come through the system on the whale sites there actually keeping a lot of reserves that the not to point to other sectors of the economy would you be buying oil financial point oh no I wouldn't be no would not be buying financial stocks right now we've seen it and share price performance especially in Europe he thinks there's a lot of derivatives out there there are times we don't know that's gonna play action there are here. The choppy market so far but rather orderly steel in terms of the decline we need that they want the. Actually. I don't think we need the big flash mob these companies are still having good earnings mercy. Basically the leaders pastors still leading the week this year if you look at. Microsoft if you look at Amazon if you look at alpha that they explode yet FaceBook right there's still driving numbers. But the problem is is that. There are some other sectors. Financials yours also oils so the problem is as we have seen shake out in the people we need to put apple moved to work. Intel actually happens the fact that the leaders are still there means that we need to change leaders if it's to really go higher other holding up the market with what's happened in the leadership is you're seeing it to start to breakdown people are starting to sell that leadership I mean just look at Google right now alphabet. You're seeing it actually trading off of what the best earnings report. I'll put the market right now you would you just pulled off in terms of buying came out and no I wouldn't I would actually stick to wit. Companies that are growing revenues in this market earnings are gonna drive stock price performance as well those are the two biggest. Drivers of stock market returns so that's what you wanna focus on those good company names even get value here with Google and Microsoft as Neitzel off over macro concerns and go revenue growers whose. Well with some revenue growers you can look at fear that tuning adjustments that PayPal is actually growing. We can even see some of the Biotech names have been have been growing but the overhang of drug pricing concerns we could get some good opportunities. In those names you know what's election cycles over. We just Grilli to a video of you that Australia right. Upright things like him our thanks to Kevin Kelly of recon capital partners I'm Fred Katayama this is what.