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Disinflation is clearly unfolding in markets: Strategist

Stock markets are trading mixed after an eventful week of economic data releases and corporate announcements. Ryan Detrick, Carson Group's Chief Market Strategist, joins Market Domination Overtime to discuss market outlooks.

Detrick emphasizes that the market's focus is primarily on inflation, with "some big-time improvements" emerging that are steering the economy back toward pre-pandemic levels. He notes that this week's data points have showcased "disinflation" taking place, although the broader public may not fully recognize it yet.

Turning his attention to the impact of current conditions on consumers, Detrick believes that "the top 40% who truly drive the economy are still in good shape, ....and we continue to think the consumer is fairly healthy overall and it should still lead to a bull market."

For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.


This post was written by Angel Smith

Video transcript


It's finishing out the week on a mixed note here.

The NASDAQ the only index closing higher but the S and P 500 NASDAQ able to notch weekly gains a weak, weak reading on consumer sentiment this morning, Wang on market today.

Joining us now is Ryan Dietrich Carson group chief market strategist Ryan.

Good to see you, sir.

Thank you for having me.

It's getting a little hot in your city.

I tell you a little warm walking over, keep it cooler in here.

It is June.

It should be, but I'm glad to be here guys.

Thank you for having me, Ryan.

Let me uh listen, it's Friday.

We're rolling into the weekend.

It feels like a good time.

Take a breath, take a pause.

We had a lot of news this week.

What we because some of your big takeaways from this week and maybe what, what do you think?

It kind of tells you about what's on the way for this market?

I mean, we just barely missed the S and P higher today, which would in all five days of an all time high.

I know we missed it.

That's only would have happened 16 other times in history.

So it tells you right now, it's pretty rare to see what we're seeing.

But listen, I'm not gonna say anything.

We probably don't already know it's all to us.

Uh Carson Group, it's all about the inflation, right?

We know the CP I data, we know the PP I data but also, you know, um New York fed consumer co consumer, what do they expect on inflation one year out?

That's back to pre pandemic levels.

Look at the ISMs ISM, manufacturing and services.

Both those prices paid are back to 2018 levels.

I mean inflation is not perfect.

We're aware, but we're starting to see some big time improvements.

And that CP I I've proved one more, one more thing on P ce.

There's over well over 100 components.

We looked at core PC 30% of those components.

Josh are negative year over year, there's some deflation taking place.

People don't realize it.

So those are some positive things this week.

Well, I think the people don't realize it is an important part of what you just said, right?

Because consumer confidence came in today.

Consumer sentiment came in below estimates, right?

And we're starting to see definitely at the very least at the low end of the consumer spectrum that people are not spending as much or they're making different choices.

That's why prices are coming down for stuff.

So how big of an obstacle is that when it comes to market returns going forward.

It, it is a small obstacle also, I guess initial claims, right?

They, they, they've been, they've been surging a might be a long way to put it, but creeping up is a better way to put it.

So, you know, you're right.

Now, listen, though, the Michigan consumer confidence it's fairly volatile but still it's very low.

And we under this is such a unique market because overall the consum is still spending, right?

I mean, the city is bustling.

People are still out there, but we're seeing those delinquencies creep up on credit cards and a little late on car payments and things and it, it is um there's no easy way to put it, but I will just say this, the top 40% who truly drive the economy are still in good shape.

And as someone who's a steward of assets, we continue to think the consumer is fairly healthy overall and it should still lead to a bull market like we've been saying for a while and that's, and the bottom line for the market.

Ryan, you still, hey, bullish, stay long equities.

We are, we've been overweight equity since December 22 right?

And one interesting factoid people like these, maybe here's the way I say this maybe May was a signal, right?

We had a really good May on the S and P getting over 4%.

We took a look that's not usually May is not that great.

So let's be very clear when you have a good may like that, the rest of the year is up over 10% on average, double you at any time returns.

It's just one stat, I understand.

But when you start laying these on top of each other, uh we continue to think this is a bull market.

I get it, we can get into, you know, participation only only five stocks, seven stocks you want to say.

Um And that's true, but overall, we still think, you know, stocks are gonna be higher from here to the end of the year.

And honestly, small mid caps might kind of take the baton.

I know it's kind of a dirty word, a lot of places, but we, we think that it could happen.