U.S. stocks closed off their session highs on Wednesday, as investors' concerns around inflation and rate hikes from the Federal Reserve eased.  The S&P 500 jumped 1.8%, the Dow Jones gained 1.4%, and the tech-heavy Nasdaq rose by 2.1% to snap a seven-day losing streak.  Sylvia Jablonski, Co-Founder and CEO of Defiance ETFs, joins Cheddar News' Closing Bell to discuss.

Closing Bell

U.S. Stocks Close Off Session Highs as Inflation Fears Ease

but let's turn back to the major indexes very strong day on Wall Street gains across the board. The tech heavy NASDAQ outperforming after comments from the central bank vice chair. Little Bernard a warning of risks of tightening too quickly joining me now is Sylvia, Jablonski, co founder and ceo of defiance. CTF Sylvia always good to see you. What do you make of the market action? Hi, thanks so much for having me. It's, it's really interesting actually. I think that, you know, the reaction to the Jackson Hole comments versus the reaction to today's comments is just strikingly different, right? But, but the message isn't super different. You know what my, my take on this is that perhaps the market and investors have come to a place where, you know, we're starting to see good news, we, we think that, you know, inflation data has speak that it's coming down, um, durables coming down a little bit of oil and gas is, is coming down quite a lot, rental cars are coming down. Somebody's, you know, you know, inflationary areas of the market are really starting to come down that last jobs read, you know, you got 315,000 back wages, wage growth seems to be waiting a little bit. So, you know, now we can sort of say, okay, well if we get 75 now that puts them above 3% you know, if you, if you look at what treasuries are telling us that feels like they're pretty close to being done granted they're going to stay there and they're going to unwind the balance sheet and all of that will continue to bring inflation down to, so maybe this is viewed as okay, maybe we're at the end of this and and that's what got us the rally today. So where do we go from here? I think a lot of people wondering september historically is a lower month and more often than not stops actually declined in the month of september. And amid some of these warnings from other fed heads, right, will we retest those mid june lows? What do you think? I think, you know, my my take on this is that, you know, I don't think will necessarily go lower than the lows. Will we retest them? I mean, you know, we got dangerously close or certainly close enough on NASDAQ s and P is sort of right back to that 50 day moving average a little bit below. So my sense of this is that the market has done a lot of work, A lot of the fraud has been taken off. You know, the kind of pullback was broad based and then the june um, the, you know, the june lows were broad based and then, you know, the kind of bounce that we saw in in july was actually pretty broad based too. So I do think that we're in for some volatility, we're in for some risk of pulling back, we're in for some risk for price declines in, in, you know, various sectors and whatnot. But overall I think we're gonna have sort of range bound training in september, you know, 60% of the time. It's a terrible month. It sort of is what it is, october is that flipped? Right? So maybe october sort of when we see the rebound, when the Fed is done and then we get news that, okay, let's hang out here at this rate and and see what happens with equities. I still think that this is a good time to buy though for long term investors, I do think we'll be in a better spot 18 months out and for viewers watching what does long term mean? Sylvia, are we talking 3 to 5 years or even longer time horizon than that? You know, I I do think that buying, you know, broadway s and P 500 exposure, NASDAQ exposure and what not will play out in the next, let's say, you know, 18 to 24 months, I expect to be at higher levels in these indices in these positions than we're at now. Um, but if you look out even longer and you think about an area like semiconductors for example, you have like no vidia and empty and in town some of these names that have just gotten absolutely clobbered, you have government money going there, you know, 50 billion going towards manufacturing, you have this massive growth and innovation the next decade is going to be about five G electric vehicles, artificial intelligence, you need ships for all of those things to work and happen. So for me that's like the 5 to 10 year trade interesting now, what about Apple? Because there is the famous saying as goes Apple, so goes the market, we got a big product suite announced today, the iphone 14, 4 versions of them, this new Apple watch as well, much more expensive one to compete with government and then some IOS updates as well. Do you think the indication is that the affluent customers still willing to spend Sylvia when it comes to Apple and that Apple could be almost an anchor for the stock market into the end of the year. I do. I'm always a huge, you know fan of Apple and it's a position that I you know, never race for my portfolio position that I continue to pick up when the market pulls back. I just think that they're touching every single corner. So they're growing in services, you know, they're growing in in sort of the health care space with the watch and the application. They're uh they're doing great on products and and iphone demands. You've had a lot of issues, there's a lot of headwinds between Covid, you know, china shutdowns, obviously inflation rates and things like that. But their cash cow, you know, 30% margins, I mean they are just continuing to grow and their numbers, even the worst expected numbers get, you know, sort of crushed every time they report. So I'm very bullish on this company. I consider them quality at the price of their trading. Now I look at this as a bargain, a bargain for Apple. I know you like chip stocks as well. Sylvia, any other sectors that you think might be a buying opportunity here and conversely sectors that you'd be staying away from at these levels. I would be looking at some of these alternative energy types of trades. So whether it's hydrogen, whether it's solar, you know, there's there's this big focus in the next decade on um carbon neutral by, you know, by 2050 you've got a lot of the climate bill going towards things like hydrogen electric vehicles. So you know, you can look at your Tesla, you can look at your plug power's your Ballard's some of the E. T. S in that space. I think that they're going to be interesting opportunities in terms of what I'm not looking at. You know, that would be sort of the higher the higher growth names that just worked in a different time. And I think, you know, I hate kind of calling them out but I'm not really looking to invest in peloton right now. I'm not looking to invest in zoom right now. Those are kind of off my radar, some of the stay at home. Staffs maybe not so keen there Sylvia. I'm just curious in terms of the Fed's next rate move based on what we heard from lily Bernard today but also what we've been hearing from other Fed heads. Are you expecting another 75 basis point rate rise come the next decision september 21st. I I think the market is pricing that in um you know, I I think that it would be unlikely to be higher than that. There's there's a chance perhaps that they go 50 and then another 25. But I I suspect that just given sort of the the force and strength and and how emboldened Fed chair Powell was in Jackson Hole. You know my my my lead would probably match the market estimate of of 75 on that. And the data I mean the data is supply that you know they are kind of doing their job and inflation is coming down and that this is working. So it feels like this should be the last of the higher side of rates but remains to be seen. Yeah, still the Fed of course maintaining that its data dependent. We'll see how the data shakes out. Sylvia Jablonski co founder and ceo defiance CTF Sylvia Good to see you and thanks