Listen as AAP Portfolio Managers Discuss the Fed and Their Favorite Stocks Now
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In our latest Action Alerts PLUS podcast conversation between co-portfolio managers Bob Lang and Chris Lang, they discuss the big event of the week, namely the Fed's September monetary policy meeting, and why there is a high probability that the fed funds rate crosses 4% as we exit 2022. This has major implications and likely means further slowing in the economy while also raising questions about earnings expectations for not just the second half of 2022 but also 2023.
Implications of Fed rate hikes has Bob and Chris also looking at consensus EPS expectations for the S&P 500 in 2023 and those for AAP portfolio positions. In some cases, like with Three-rated Morgan Stanley (MS) , estimations for its EPS growing 17.7% in 2023 seem rather dubious barring a significant rebound in the IPO calendar. The odds of that happening looking increasingly grim considering both the current state economy and the stock market.
Pivoting to the market, Bob explains why the 3900 level for the S&P 500 is critical, and also why the market re-testing the June lows is important for the market to move forward.
They also discuss other items to watch this week, including options and volatility expiration, earnings from Costco Wholesale (COST) , investor conferences and potential pre-announcements, and the Flash September PMI data from S&P Global.
And for new AAP club members, Bob and Chris talk about two names in the portfolio they should feel comfortable buying at current levels.
Give it a listen!
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Action Alerts PLUSis long MS and COST.