Mario Veneroso, partner & wealth manager with Kingsview Asset Management, joined Cheddar News to discuss Monday's trading session following last week's Fed decision to hike rates as well as Friday's jobs data.

Mario Veneroso, partner &amp; wealth manager with Kingsview Asset Management, joined Cheddar News to discuss Monday's trading session following last week's Fed decision to hike rates as well as Friday's jobs data.

Closing Bell

Stocks Mixed After Fed Decision, Jobs Data

Joining me now is Mario that arose. So partner and wealth manager, the fiduciary advisory firm kings you, asset management Mario always good to have you on set. We like that here at the stock exchange and kind of a disappointing day after what was a stellar report wide. So the question becomes, is the dog wagging the tail or the tail wagging the dog you look at last week and you have to go in chronological order of what happened and how the markets reacted. Jerome Powell came on with this Fed minutes saying we're gonna raise 25 basis points and that the disinflationary process began, which was exciting news for the markets, the markets rallied. Then all of a sudden we had a jobs report that came in on Friday. Now the estimate on the street was 187,000 jobs. We had 517,000. That's more than 2.5 times the estimate amount. And you have to go back to history back in 1969, Uh, is the last time where we had unemployment at 3.4%. So what does that mean as an investor? Well, essentially Jerome Powell, our economy and interest rates. It's almost like a seesaw. And at this point, the Fed of having a soft landing their job is gonna be tougher now because they're gonna have ongoing rate hikes. And that was expo What he said in the Fed minutes. So this jobs report right? More than half a million jobs added. As you mentioned, 517,000 blowing past I think anyone's expectation, right. Is this an outlier, is there any information that would indicate, well, maybe this was just a one off, maybe this was seasonal hiring. I saw some of it actually attributed to seasonal hiring and this might not really be paving the path forward. You know, that's a great question. So the jobs report is backward looking and if you look at the jobs report and you see which area, what sector had the most jobs growth, It was leisure and hospitality, which would tend to coincide with seasonality. However, if you look at the news over the last few weeks, you get all these firms, whether it's google Microsoft, actually the news today with Dell 6000 layoffs, so I think it's gonna put the Fed in a tougher position now, whether this is an outlier is yet to be seen, but I think the jobs number and the unemployment rate inevitably will have to start taking up with all these tech companies starting to do these layoffs, what should investors do in this environment? So it's interesting if you look at last year and you see what lagged the market, it was technology, it was real estate, it was consumer discretionary, it was telecommunication services. If you look at what's leading the market this year, it's all those lagging sectors of last year at the end of the day, I'm a big disciple of discipline. I think investors need to own fundamentally sound companies, strong balance sheets and I say this like a broken record. I love dividends. I love cash flow. I want companies that will pay me income and more importantly, I want companies that will pay me future income. So therefore I like solid blue chip stocks with dividends. Okay, so what are some of these stocks right for investors watching at home? They might be wondering what is this stock with these characteristics? Yeah. So I think um, a great purview to look at these stocks. You can take an aristocrat, E. T. F. Uh, N. O. B. L. Nancy octagon boy Larry. And essentially you can look at that E. T. F. As a barometer and then do your own research within the holdings of that type of E. T. F. And see which companies will fit your criteria, your time horizon and most importantly your suitability. Do you think the bottom is behind us? I think we're gonna have more volatility ahead. So we just recently passed the Golden Cross. That's when the 50 day crosses the 200 day moving averages. The averages are looking healthier. We just came off the best January in the markets in 22 years. So I think it's only plausible that the markets cool off a bit, which implies a little bit more volatility, but we can't forget the January effect for every listener that's watching this at home. If you look at the market research since World War II, of the time that the markets higher in January the rest of the year tends to be higher. And on average that number is about 11.5% which is above normal mark market metrics. So I think the market shaping up. I think the big thing, the big perhaps tailwind will be the Fed and what they do. Is it two more hikes or is it three more rate hikes? Yeah. And of course what happens with inflation? Right. Can to be effective and truly bringing down inflation for the long term. I mean we saw with Tyson's earnings today, right? You know the bird flu supply changed shortage, you know, at the end of the day inflationary numbers. Yes, they're coming down, you know, we were at 9% last summer recently we're at 6% I think if we get closer to five and then the Fed fund rate is at five or five and a quarter, which is 2 to 3 more. Right. I think we're going to have a little bit more equilibrium. And I think at that point, I agree with jerome Powell, the disinflationary process has started but that doesn't mean it's effective as of yet. Sure. And of course no two sectors obviously the same in that from Mario Vienna roso partner and wealth manager, the producer Gary advisory firm Kings. You asset management Mario, thank you. Thank you