Dismal earnings reports from Kohl's and Macy's doesn't mean the consumer is weak, says Thomas Wilson of Brinker Capital.
Wall Street couldn't hold on to its earlier gains all three indexes trading lower. For more on how to navigate this market we're joined by Thomas Wilson. He's a senior investment managers Brinker capital welcome Tom Apple's down sharply oil's down Coles head dismal earnings got jobless claims rising. What's really driving them. It's yeah I think first off jobless claims was a big economic news that came out. I jobless claims are up that was a little bit of a surprise. Coming in about 294000. That moves the four week average up a bit too closer to 48 to sixty. I think is you'd think about where we are at this point of the business cycle. Having jobless claims between 550000. Is about. Right all right now moving on corporate news Coles up profit quarterly profit dropped 87 saying coming one day after Macy's dismal earnings and also better earnings from. The likes of gap soul. What's your feelings about investing in the retail sector or at least department store apparel sector sure why I think. I think to be incorrect for investors to extrapolate that. These companies that poor results is it signaled that the consumers week because we don't see it that way there's lots of suggested consumers strong. Rather this is just part of it longer term secular trend of consumers wanted to our purchase items online as opposed to going into the big boxes him. And as for the consumer that you're still positive about their spending in other areas a laps absolutely ghastly. One of his barber positive on the consumers some of that economic that for example we just have been rising for some time clearly on appointments dale. The number of employees who are pro actively leaving their jobs today is at a rate that we haven't seen since the end of 2007. So. If you're proactively leaving you feeling good about your prospects elsewhere. A Brazilian stocks there have made it come back this year what are your thoughts on. Emerging market is the continent to weighed in at this time at a time when you still have factors such as you know China and low oil prices. Well on on this subject to present itself there's a lot of horrible point. Fifteen a country it's experience unemployment double digits inflation for double digits for multiple years. Really Brazilian market is kind of rally this year that I hope. That political change lead to economic change. Brazil being eighth largest economy in the world clearly key economy get emerging markets role. As oil and other commodities. We can succumb which we have seen thus far points sixteen. That is a general positive for the emerging markets lastly. Fixed income yeah abdicate investing in non traditional fixed income what do you mean by that or so with not traditionally look at high yield is verse of books ample. But also long short fixed income. There are managers or purple is out there were managers will. Buy gold along the credits that they feel comfortable at. And like my short the credits that the wrong couple as a result the overall portfolio tends to have a fairly low standard deviation. And a lot of interest rate or duration risk before this old the individuals small investor out there. Option they still be buying intermediate long term intermediate term funds. As Connolly in the report we will. It moved one of the great things but in immediate terminal extrapolate you know quality bonds. Is that they're gonna go up when bad things happened in the market however to further diversify that segment of the fixed income. You probably would look at having 2030%. To some non traditional fixed and come. So that when we do start to see rates rise in the values of those bonds that are long core quality holdings can be offset. But these nontraditional investments that could potentially do well and rising rate. Excellent treatment. Our thanks Thomas Wilson a breaker capital I'm Fred Katayama and this is.