(Bloomberg) — Dreary headlines wash over investors every day — war in Ukraine, inflation, the unending spread of Covid-19, supply-chain troubles. All the gloom has market analysts downgrading prospects for U.S. growth and predicting a recession.
But what if their projections are overblown? Sylvia Jablonski, the chief executive officer, chief investment officer and co-founder of Defiance ETFs, joined the “What Goes Up” podcast to talk about why she’s optimistic about the market’s prospects for the rest of the year and why she likes stocks tied to the economic reopening.
Below are lightly edited and condensed highlights of the conversation. Click here to listen to the whole podcast, and subscribe on Apple Podcasts or wherever you listen.
Q: How are you making sense of recent market volatility?
A: If you ask the average investor, my guess is that they would say it doesn’t feel super good to be invested in the market this year. It’s not as fun as it has been for the last decade, let’s say, or even those few months post Covid where everything just started going straight up and all of our trading accounts looked great, we all looked like geniuses. And now, the market just has a lot of headwinds. There’s a lot of uncertainty in the market right now. You have a Fed that wants to raise rates to lower inflation and not create a recession. You hear about this soft landing. Inflation has been higher than ever, you have issues with geopolitics, you have a war — the Russia-Ukraine situation. You have a strain on perhaps major commodities — oil, gas, and then you start going down, depending on how long this goes, into wheat and different things. And you have a lot of, essentially, fear that the combination of Fed hikes and inflation will create a situation where we’re in stagflation or perhaps just don’t have great growth in the future.
But, my take on this is here we are, it makes sense. There are a lot of these headwinds to the market, but what that means is that you’re going to have this range-bound volatility. The market’s going to trade in these…