INSUBCONTINENT EXCLUSIVE:
By Sarah PonczekJames Comey
These are names you’re probably hoping not to hear if you’re holding stocks heading into the weekend.
Headline risk is high
There’s China trade tensions and war in the Middle East
Still, the SP 500 Index is poised to end the week up 2 percent
Things have been a little easier for investors -- but for how long
Former FBI director Comey is set to make multiple media appearances
before the formal release of his book next week
Speculation over the future of Deputy Attorney General Rosenstein has picked up as the Mueller probe continues
Cohen, President Donald Trump’s personal attorney, remains in the spotlight after the FBI raided his office and home.
It raises the
question, how do investors position ahead of a weekend that could be full of breaking news
“I can’t read the president’s mind and
can’t predict his actions, but if you believe we are going to get news over the weekend, you would want to de-risk going into that
Because if you do wind up with a situation where Rosenstein or Mueller get fired, that would create more volatility next week,” said
Michael O’Rourke, JonesTrading’s chief market strategist
“If you’re a long-term investor, you’re probably not going to sell for those reasons
If you’re trading or a hedge fund, you would want to be more defensive or potentially short.”
Brian Shepardson, first vice president of
James Investment Research in Xenia, Ohio, is among the former
His firm manages $4.5 billion and has a more long-term focus
He’s sitting tight, hoping the 200-day moving average holds, as it has over the past few weeks, should news erupt
But he sees why investors might pare equity exposure.
“What a lot of people do is, if they’re over any type of equity target they may
have, maybe sell on a Friday, get to a position that you’re comfortable with from the standpoint that on Saturday and Sunday news can come
out without the availability to change a portfolio,” Shepardson said
“That’s probably what we’re seeing a little bit of on the bit of pullback today.”
The SP 500 declined 0.3 per cent Friday
Trading volume in the benchmark was about 17 per cent below the 30-day average
The Cboe Volatility Index, known as the VIX, fell to 17.4 after hovering above 20 this week.
“The VIX to me is indicating the anxiety
level has lessened to some extent -- I don’t see any extra levels of anxiety, so you have to stick with what you want to do and not get
jacked out by irrational fears,” said Donald Selkin, New York-based chief market strategist at Newbridge Securities Corp
Still, he added, a hedge could be a good idea on the eve of a weekend of potential “fireworks.”
“I wouldn’t be afraid to do
something, but hedge yourself at the same time so you don’t get caught at an out-of-left-field situation with the Russia investigation or
something in the Middle East,” he said.
Kevin Walkush, portfolio manager at Oregon-based Jensen Investment Management, is wary of
overreacting to current events.
“It appears the market has become much more short-term focused, and it continues to get shorter-term
“For investors who have that kind of time horizon, then maybe that’s going to impact their strategies
But I think for most people, I don’t think it’s something as much to be worried about in the long run.”
