Close Close
Sign In
Newsletters
Popular Financial Topics Discover relevant content from across the suite of ALM legal publications From the Industry More content from ThinkAdvisor and select sponsors Investment Advisor Issue Gallery Read digital editions of Investment Advisor Magazine Tax Facts Get clear, current, and reliable answers to pressing tax questions
Luminaries Awards
Podcast Center Video Center Webcasts Resource Center Events
About ThinkAdvisor Contact Us Advertise With Us Asset & Logo Licensing Sitemap Terms of Service Privacy Policy Copyright © 2024 ALM Global, LLC. All Rights Reserved.
ThinkAdvisor
Ryan Detrick, former LPL market strategist

Portfolio > Economy & Markets

Beware of TV Economists Bearing Doomsday Forecasts: Carson's Detrick

By Dinah Wisenberg Brin

X
Your article was successfully shared with the contacts you provided.

A major stock selloff is unlikely in the near term despite this month’s market pullback,  according to Ryan Detrick, Carson Group’s chief market strategist, who predicted equities will reach new highs before year end.

“You might hear some economist on TV with a bowtie telling you the end is near, but if the credit markets aren’t worried, I’m not worried,” he said.

Credit markets are showing little stress, which generally is a good sign for the economy and stocks, Detrick said in a column Wednesday on the firm’s website.

“We think credit markets have some of the smartest investors in the room, and if they aren’t worried, the weakness in the market likely won’t get much worse and may offer an opportunity to add to equities,” he wrote.

Detrick noted investor fear has risen with recent market weakness, which he said he had expected as a seasonal pullback.

September could prove tricky as well, he wrote, “but with credit markets showing very little stress, we don’t expect a major stock meltdown like so many on TV keep predicting. Instead, we remain overweight equities and do expect stocks to make new highs before the year is done, it just might take a little more consolidation first.”

Credit spreads show how much extra interest over Treasury rates investors demand from companies that want to borrow money, the strategist explained. 

“If investors believe a recession is imminent, they may expect lending to companies to be more risky and hence demand higher interest rates. In other words, if there was a monster under the bed the credit markets would likely show it,” Detrick said. But spreads are tight now, while in past recessions they soared, he wrote.

The stock market may break recent lows and officially tag a minor pullback of 5% or more, he said, but there’s “major support just beneath current levels.”

Pictured: Ryan Detrick

Dinah Wisenberg Brin

NOT FOR REPRINT

© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.