Kingsview CIO Scott Martin On Fox Business Making Money with Charles Payne 1.2.2024
CHERYL CASONE: Shares of Apple falling over 3% today. Weighing heavily on the NASDAQ after receiving the first downgrade to underweight from Barclays since 2019. Let’s bring in Kingsview Wealth Management, CIO, Scott Martin, and Manword Press, chief investment strategist, Shah Gilani. Great to see you gentlemen, and happy New Year to both of you. Sha, let’s start with you. You still see tech leading the market this year, but what are your thoughts on this downgrade of Apple? I mean, the analyst here from Barclays is citing weak iPhone demand for the 15. The problem is that sets up potential issues for the 16 launch, and we know that Apple likes to give us a new phone every year.
SHAH GILANI: Cheryl, I’ll admit I was wrong on Apple. We are long Apple, but we are moving our stops up. But as far as adding to the position last year, didn’t do anything with it. I was happy to see it go up, but I thought we were going to see downgrades a lot sooner. So it doesn’t surprise me. I think Apple probably can drift downward from here. I think Apple’s not going to do well as far as sales until they can incorporate chat gpt and whatever other AI they can throughout the ecosystem of all Apple products, but especially the smartphones. And I think that’s probably what investors are waiting for and I think until we see something like that, I think the next refresh cycle is probably going to be underwhelming. Yeah,
CASONE: Well, and that’s what the analyst says, but at the same time, Scott Martin, the magnificent seven is all the talk right now. And the question would be, are we still going to get the same returns this year from this group of stocks? Maybe not as hot as tech is. I mean maybe a positive return nonetheless, but not what we’ve had for 2023. What do you say?
SCOTT MARTIN: Yeah, I mean potentially underwhelming, Cheryl, which if you think about the magnificent seven, all the things they did for the index last year, I mean, my goodness, 40, 50, 70, 80, a hundred percent. I mean, yeah, there’s a good chance investors that those results will be a little bit underwhelming this year as far as returns, but we could still get a good 15 to 20% out of companies like Apple and Amazon like you said. And I think Shah made a great point. I personally have a very, very close and intimate, let’s say almost relationship with Siri for example, but they’ve been slow to incorporate some more kind of Siri type features into that AI space that’s growing every day. So until Apple kind of let’s say, makes some more excitement out there in the marketplace, maybe they acquire a couple companies with all the cash that they have in their balance sheet. I mean, the iPhone sixteen, seventeen, eighteen, nineteen really aren’t that attractive to me, and I think Apple’s effectiveness, Cheryl, on their products is suddenly kind of waning regarding other competition that they have out there.
CASONE: Yeah, it seems like this is kind of a time when you start to miss Steve Jobs and the innovation that he was so famous for, and that was always the concern about Tim Cook when he replaced jobs. Let’s talk about oil because we’ve actually seen the prices rising amid new fears of supply disruptions with this ongoing conflict in the Middle East and the Red Sea shot. Your thoughts on this in particular, as we’re saying like a shipping company like Maersk who’s saying we’re not going to use the Red Sea transcript right now because of concerns about the Houthis attacks.
GILANI: Oil is a problem for investors right now. If we see some kind of shock that elevates prices because investors are counting on lower oil prices to keep inflation down, to maintain the downward trends that we’ve been enjoying so far. That’s also driven the Fed to not only not raise anymore, but likely cuts supposedly in 2023. I’m not in that camp. We’re going to have several cuts. I think we’ll get a couple probably towards the second half of the year, but oil is a big part of that whole question as to whether or not we will see inflation actually remain under control or whether or not if we get some kind of pop with maybe WTI above a hundred, well all of a sudden that shake up investors fears of maybe another rate hike at somewhere down the road, what will that do throughout the economy? But so far, so good. And I don’t see oil really jumping too high right now because right now China is still a problem as far as its growth. I think they just declared, I think for the third quarter in a row, again, lower manufacturing as far as domestic manufacturer. And that means their exports aren’t going to be good, and that means their demand for oil isn’t going to be that high. Keeping oil down right now and barring some exogenous shock, I think is going to probably remain fairly low. Well,
CASONE: We’re also seeing increased domestic production here at home, which of course the Biden administration doesn’t want to talk about, but it’s happened nonetheless. Scott, lots more to you. Investing resolutions. What do you have?
MARTIN: Try not to get too caught up in last year, Cheryl. I mean, that’s the thing. Every year is different. Every factor when you think about economics, when you think about geopolitics is different than it is the previous year. Even though it feels like it will carry over every year will be different for every stock and every investor. So just make sure that you take today’s action or the action that’s going to happen in the next few weeks as a way to kind of pertain to your investing future. Not looking back at last year and saying, Hey, this could be repeat or different than last year, because it probably will be, but it also be more akin to say 2024 than it is in 2023. All
CASONE: Right, gentlemen. Thank you. Good to see you both. See you.