Kingsview CIO Scott Martin On Fox Business Your World With Neil Cavuto 12.13.2023
NEIL CAVUTO: Dow all time high. Do we have the 37,001? We were doing guys a second ago because that one I really liked, but we will fine tune this, but our graphics guys went nuts today because the Dow is now added. There we go. Thank you. That is the highest the DAO has ever been. I broke a record that goes back almost two years. Scott Martin is here to celebrate not only that record, but the graphics that go with it. Scott, always good
SCOTT MARTIN: Where’s the champagne?
NEIL CAVUTO: Yes, indeed. Well, I already drank it, but you know what’s remarkable?
SCOTT MARTIN: I’ve been drinking too.
NEIL CAVUTO: I bet you have. But you know what’s remarkable about it? We talk about it, Scott climbing a wall of worry and all of that. Then along comes the Federal Reserve as expected. Not moving on rates today, but hinting of three rate cuts to come next week and then it was off to the races. What did you make of that?
SCOTT MARTIN: Yes, three rate cuts. Neil, potentially next year ahead of this very important I think election and a federal reserve, Neil, that has come to watch you and me talk about the Fed’s role in what was pressuring and keeping risk and everything compressed for the last 6, 9, 12, 18 months. Listening to you and me talk, Neil, over the course of the last few months that the Fed needed to, and I quote, chill, take a deep breath, relax, let the market decide what we need to do going forward. The Fed has figured that out, which was lower interest rates or at least step back do not hike anymore because inflation is calming down businesses. Everybody is clamoring for things to loosen up. They finally are getting it and that’s why the market likes it.
NEIL CAVUTO: You know what’s interesting too, Scott, besides the Dow, it’s on pace to be up 12% this year. The NASDAQ rich in all those technology names up 40%. If you think about it, apple, which hit an all time high today, that stock this year alone added a trillion dollars to its market value. There’s no richer market, richer company on the planet. So what about next year? That’s going to be a tough act to top
SCOTT MARTIN: A couple more trillion and you’ve got some real money there, Neil, and it is going to be tough to pick up from where we are today, but what ends up happening, I believe eventually this euphoria hopefully will wear off because your point is well taken. It’s not sustainable. Things aren’t going to grow to the sky like the trees do typically, or at least I think they do on Mars or Venus here. They don’t on earth and stocks don’t either, but what stocks can do is get extended in valuation. It can get extended in say, let’s say euphoria when it comes to how investors are looking at today and looking at days recent. But all that means is that as an individual investor going forward, when you look at your portfolio, you need to probably do some rebalancing here, but take some pullbacks, which we will get next year. Believe me, you not every day is going to be up and use those times to start to rebuild your stock portfolio as well because I think things are good going forward, whether we get rate cuts or not. If rates just hang out here and the market takes them down as it is, banks, oil companies, consumer discretionary stocks, those are all great places to be as we go into 2024.
NEIL CAVUTO: Well, the one thing you’re seeing in a mortgage refinancing activity that’s picked up considerably, I believe demand was up about 19%. We’re likely to see more of that, play that out.
SCOTT MARTIN: Yes, it does, and that’s something too that has been a strain on the economy, Neil. The housing market has been very dormant in the last six months because rates have spiked on people when they didn’t expect to and prices spiked on people because there were major supply issues. Now those things are going to normalize. Now they’re going to loosen up exactly what the Fed needed things to do because they weren’t working out the way I think the Fed had them positioned prior to. We’re seeing that talk come out of Powell as well today. It looks good going forward, man. Alright,
NEIL CAVUTO: Thank you very much, my friend, Scott, Martin, on all of that.