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Barrow Funds' Bechtel on U.S. market's Brexit vote focus

Wednesday, June 22, 2016 - 03:40

David Bechtel, Principal at Barrow Funds talks with Bobbi Rebell about how the Brexit vote could impact U.S. financial markets as well as Yellen's comments today on the vote.

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And you already had concerns for the markets that Britain could very well vote on Thursday to leave the European Union David Bechtel principal at arrow funds. Is here with more on why the US markets are so focused. I what's happening across the pond great to have you thanks for having me so why are we so focused on this. It's it's more about what we don't now than what we do now we know from Britain stays and what the deal is. Whereas if they leave. There's a lot is uncertain about what might happen so it's easy to modeling companies forecasted revenues how much business they do with the UK. How that might be negatively impacted by direction. But there are other more general market level. Issues and concerns around the instability that causes for all of Europe is just the first domino to leave. What happens if they lose any access to that you unfavorable trade basis. So of a lot of unknowns I think that level and certainly concerns people and rightly so. And what yeah it almost no matter what Twitter post certainly if they were to vote is today is a done deal that that this is over an issue. Behind them or could this resurface well if I think like the Scottish referendum it probably goes away for awhile and certainly isn't in the headlines and we can move beyond it as market participants it might come back at some later date. I think a lot of people would just be relieved if they decided to stay in and we can move on. Fed chair Janet Yellen spoke again today second day testifying in front of congress as you just the cracks of and you know what the fan reaction might be either way. Can talk a little about that yeah I mean it's more of the same from the Fed it's more evidence. Donation us. Very little rushed to raise rates a very data dependent that they're hoping for more job growth more wage improvement. But they're not counting on it. So this all goes hand in hand with the Fed's tone. Since the speech at the New York economic club a few months ago which is walking back any expectations. Of rate hikes. From the senior members of the fan. Jeff illness today though when asked said that the Fed did not plan to meet. On Friday or Saturday night vote went for them to to leave the U what do you make of that and what impacted net what does that say about. Their reaction to whatever happens. I think what it tells you is the Fed is about as stylish as they can be without going negative on interest rates which they said they won't do. So to some degree reading between the lines it might mean that they think they don't have a lot of ammo to deal with breaks it shouldn't care. Let's talk broader about the market we're getting towards three what else isn't focused for you. Well we're looking at economic numbers you know what we do our mutual funds is we look for quality stocks but also represented compelling value. And even in markets like the ones we see today where things are bit pricey you know overvalued at the index level. If you dig deep enough and sift through the names that are in each index you can time high quality stocks. The trade with the margins. Can give me some examples such as investors should be looking at sure we're where we're really into WD-40. We'd like that stock it's agree consumer brand you know when you go to Home Depot. To buy. A lubricant you don't write down on one of by silicon liver can you write down WD-40. There's a lot of brand equity in the company. We like some of the refiners are have got pummeled lately. A Western Refining and have a great franchise in the American southwest stocks down 45% of the past twelve months we take a great time. Thank you so much our thanks to David Bechtel there up until about your about this is fighters.

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Barrow Funds' Bechtel on U.S. market's Brexit vote focus

Wednesday, June 22, 2016 - 03:40