Bloomberg Markets Special Simulcast Day Four

You can also listen to our radio show at two pm Eastern Time on Bloomberg Radio or watch us on YouTube search Bloomberg Global News. Welcome to our global simulcast across Bloomberg TV, Radio and YouTube Romain, Boston, alongside Pretty Group To and Tim Stanifek. We're gonna be walking you through the markets all day long and taking a look back at one as well as a look ahead to two.

Right now, Tim, we're looking at guess what a record high on SMB five, record high on the Dow Jones Industrial Average, and the NASDAC one hundred actually came within about four points of a record high on its own. It seems like a little bit of a theme happening in the Santa Claus Reraili. I got a fun little technical that I spotted on the Market's live blog courtesy of Matt Turner earlier today. The SMP five hundred hasn't dip below it's two day moving average yet this year.

That failure has only happened four other time since one, and then after three of those occurrences, the SMP five hundred sign annual decline the following year. So good thing to keep in mind as we look forward to two throughout our show today. Yeah, and which a point, I mean, that's a that's a fun fact. But think when was the last time we were burned low the two day moving average pop quiz? I'm guessing it was March? Yeah, April? Oh,

look at that. I'm starting to get better at these pop quizzes, rom Man, I know, I gotta make the questions a little bit harder here. All right, let's we're gonna, of course, walk you through this market. We're gonna get some great insights here from a big slate of guests

we have coming up. But we want to jump right over to Abigail doo Little right now for a little bit more of a breakdown, and what's going on in the market, Abigail, Well, those technicals that you all were just talking about super interesting, And yes, it would suggest that the market is overextended right now, not having gone to that long term support. Maybe couldn't be a little b difficult. In the yesterday we were talking about apple

growth is expected to slow dramatically. As for what's really happening today, that all time high for the SMP five on page for the seventy first record close of the year. The NAZAC outperforming on some China tech strength. Maybe we'll

take a look at that in a moment. And then super interesting is the fact that the SMP five hundred hotel index it is slightly higher despite having some exposure to the cruise operators because of course, earlier today the CDC coming out with an advisory saying that folks shouldn't go on cruise ships, whether vaccinated or not, and we

saw a big drop off for the cruise lines. The Royal Caribbean Carnival down about half a percent at this point, so not a huge huge decline, but if you consider the these stocks earlier up three percent down two percent at the lows, that's a five to six percent swing for stocks and are still down six from the pre pandemic high. The revenues, it's just incredible. I was taking a look at Carnival this year, It's expected to put up not even two billion. In twenty eighteen it was

nineteen billion. So that's what investors are still worried about. Yeah, Abigail, When I think cruise lines, when I think that travel sector, I think volatility. I'm curious about the volatility not of the stock market, but of the bond market. What do

you see there? You know, it's very interesting and that's a great question from the standpoint that these cruise lines, similar to airlines during the pandemic, just to make it through, really needed to raise a tremendous amount of capital through debts. So that's going to be something to watch, the credit for the cruise lines, and to some degree right now the airline is given the fact that oh, Macron is really causing so many cancelations there for um the number

of the airlines. I think that Jet Blue today came out saying that they're canceling nearly flights between January tent and for cruise operators, it's gonna be interesting to see whether or not folks, people who are very committed to cruising. I not one of them, but I do have friends who loved to cruise a couple of times each year. Whether they're gonna listen to this advisory and will we see a real drop off in revenue? If so, that could really show up in that credit. All right, something

we're gonna keep an eye on all day long. Here Abigail Doolittle, we'll get check in with her a little bit later here in the day. We want to get right to our next guest here, Ross Mayfield Bared Investment Strategy analyst, joining the big program right now, and Ross Um, you know, there's obviously a lot of distortions this week and last week because of the low volume here as

we head towards the end of the year. But anybody who's looking ahead to two and trying to sort of divine where the SMP might end up, it's got to all be tied to where they think earnings, corporate earnings themselves are gonna go. And I'm curious as to whether you think that some of the I guess relative outperformance that we saw in twenty twenty one with regards to margins and earnings and revenue growth, whether that continues into

next year. Yes, so I think a bit more of a mixed bag, right, So, we do expect earnings growth to be positive. There's a lot of tail winds. They're a really strong consumer, some operational efficiencies that companies put on during the pandemic and should continue forward. UM, and revenue should still be strong given um, you know, pretty

strong nominal GDP growth that we expect. However, margins have have peaked and you know started to roll over a little bit, still at extremely high levels, still near records, but have peaked and rolled over. We we all have heard the inflation story and know about rising input cost inflation, particularly UM the stickiness of of wage inflation, which which

is really one of the bigger input factors across across industry. UM. So I do think, you know, there's gonna be enough corporate earnings to to drive the market higher outside of something that really brings multiples down. Usually in the early part of a rate high cycle, multiples are you know, kind of flat historically, So if you're taking high single digit, low double digit earnings growth, I think you can probably

translate that pretty well to equity performance. Or also, we've been asking a lot of our guests this week about the biggest risks in two A lot of them have agreed that it would be a misstep by the Federal Reserve. I'm wondering where you fall. Well at the same place I always following him, asked this question, and the biggest risk is the one we don't see Keman because at the beginning of nobody had global pandemic on their on their cheek sheets. So you know that's kind of a

copied answer, but um no, but it was. It was poetic ross we like and we checked that one off that the pandemic is ongoing right there. There we go. Yeah, on the Fed front, though, you know you mentioned at that top, we're sitting at all. Tom has on all the major indusicries. The market is aware of the Feds, uh, you know, tapering timeline getting more aggressive. They're aware or they're basically pricing in three rate hikes for next year

the Fed. I think at this point, you know, if you wanted to skew the risk one way, it would be dubbish. There's gonna be some new appointees who will probably lean dubbish. And if inflation moderates or if omicron has an effect on the labor market, I think you could actually see the FED skew dubbish given one of the two options, um, in which case it wouldn't necessarily be you know, a headline risk for the market. Um, it would it would probably be a bit more of

a tail wind. Regardless. Uh, we expect monetary policy to be extremely accommodative, even if they hike at on plan Ross. We gotta talk about tech here because you can't continue that's really strong equity performers into the new year without having tech on your side. What is the bull and bear case for Big Tech? Sure? I mean the bull case is long term secular growth trends. It's you know, wide modes, low debt, high cash um. You know, really

strong margins and the ability to protect those margins. They've mostly shown throughout this pandemic. UM. They've also been a bit of a covid heade right. So throughout Big Tech was the kind of sector or what you know, subsector that was leading the market higher. It's popped, you know,

throughout the various waves over the last year. So so it's not super hard to make a strong bull case for these companies because they are just such high performing operators and have done so well over the last decade. As we move into this next year and kind of get into the you know, maybe mid cycle uh kind of themes high quality is a place that we're looking to take refuge, and that's that's a lot of those

big tech operators. On the flip side, you look at interest rates, rising interest rates is kind of um, rising long interest rates is kind of a headwind for the growthier parts of the market. You know overall, UM, small tech, small growth is certainly taking it on the chin this year. Um, that would be a headwind for big tech if rates

were really to become uncapped. And then the antitrust uh, you know, sentiment, it's kind of taken a backseat as build back better has has become the focus in Washington right now and getting that back on track. But I do think you know, with more appointees, um, you know, personnel's policies, So I think you could continue to see that sentiment throughout the year and and maybe even ramp up as a midterm election talking point any way to diversify away from equities. Anything that you look at. We

only got about a minute left. That's that's the that's the number one question on the board because rising inflation, rising rates, you really don't want to be in treasuries, safe safe fixed income cash is just losing money. I do going out the credit spectrum and fixed income in shorting duration something like you know, maybe bank loans or or or shorter duration high yield could be a place to go. You know, valuation there, as with the equity market,

is fairly rich. But I do think if you see even a slight uptake and rates, it's gonna be one of the few places takes solids. Um. You know, we don't ever really mind a small uh small allocation to alternatives or commodities, but we would keep it, we would keep it small. All right, Ross Mayfield, It Bair, thanks so much for joining us. This is Bloomberg Market Special coverage this week, simulcast across Bloomberg TV, radio and on YouTube.

Romain Bostick alongside Tim Stanovic and Crety Gupta here helping you count down to the clothes here in equity markets right now, keep an eye on what's going on in the commodity space. Settlement right now of noim ex scrude future is gonna come in just below seventy seven bucks of barrel. We should we've been talking all day, all week, frankly about how light the volume is in the equity markets. We should point out that, uh in the w T I markets future markets were some the wrack below where

we would normally be with regards to average daily volume. Here, gasoline price is going to finish the day slightly higher here as well, up about eight tenths of our percent. In the futures market at the pump, you're paying about three twenty nine on average. Here, Gold futures higher by about five tenths of our percent. And when you look at some of the soft commodities, pretty much everything is in the red today, with the exception of cotton. Cotton

future stem up about one percent right now. We know restaurants around the country are continuing to struggle to pay for those higher input costs as COVID cases continue to surge as well. Restaurants are also struggling to keep their doors open. Many are trying to recoup their losses from the last twenty months or so when lockdown began. Joining us now is David Nafeld. He's the owner and executive chef of the restaurant Kfico. It's an Italian restaurant in

San Francisco. David, thanks so much for joining us. You're also a member of the Independent Restaurant Coalition. It's an organization that calls itself a voice for the independent restaurant and bar community nationwide. Hey, give us an update on what's happening at KFICO right now when it comes to amicron. Are you seeing this not only affects staff right now, but uh but affect patrons dining there too. I mean

cases are spiking in California, just like to our New York. Yeah, there's First of all, thank you so much for having me. And secondly, uh, you know, it's been a tremendous um hit to us. We've just made the hard decision to close both of the restaurants for the rest of the year.

We've had a spike in positive cases, um you know, and the only reason we're able to detect that is because we've come out of pocket over five dollars to get these massively over inflated uh self tests right, because that's not being provided for us by our local, state or federal government. So that's something that we need to do to protect our own staff and to protect the public. Then you add to that the fact that when we get a number of positive cases, we try and do

what we think is the right thing to do. By shutting down. We lose a tremendous amount of money doing that. We had to cancel all of our New Year's Eve reservations, which is supposed to be our single biggest revenue driver of the entire year. Um. You know, it is really really a tough time right now for us, our city,

but also just our industry in general. Everyone is hurting. Um. I am seeing just dozens by the day restaurants locally, state and federally just say that they are going to shut down for the rest of the year because they don't know what's going on. And we all feel, honestly a bit abandoned by Congress who said that they were going to refill the restaurant Revitalization fund well over a year ago, and you have almost two thousand restaurants that

applied for it that never got it. And right now we're we're all, you know, deciding on whether we're going to be able to open back up at all. Talk was a little bit about perhaps the EBBS and flows you've seen in terms of consumers that have come in while your restaurant was open as a result of say, vaccine mandates or mask mandates, which seemed to also ebb and flow in various states. Yeah, I mean evan flow

is a great way to put it. There's been moments where um consumer um confidence is up and they want to come in, they want to dine inside. And you will see one news report come out within a day and you'll see reservations for the next week be impacted.

You'll see a demand for outdoor seating go from all time high to almost zero in the colder months here in San Francisco and and obviously I can imagine in the colder parts of the country, it's it's completely nullified, uh to a news report will come out and then people all of a sudden are willing to dine in the rain outside, right, Um, but they don't want to

eat inside. And so that is incredibly hard for a restaurant to whether the storm of It's very hard in terms of predictability and visibility as to how much we need to order, how much we need to staff, and then staffing. As you guys said in your previous segment is you know, something that is very challenging for all

of us to deal with. UM. You know, we tend to pay on the higher side in terms of our restaurant group to begin with, but you know, it is something that you know, the guest is going to feel the impact because of raising prices all across the board. You know, our cost of goods have gone up through the roof, our losses have gone up through the roof, our debt has increased, UM, you know, and labor is just gonna go up and up and up to get

viable candidates, David, what what brings stability here? What what would you want to see with regards to assistance and help that you think can maybe bring some normalcy and stability to this industry. Well, there's one answer, right, There's one simple, silver bullet answer, and that's the Restaurant Revitalization Fund, which we are at the Independent Restaurant Coalition were fighting

for since March. We fought UM, you know, and when every other restaurant UM you know, trade group gave up on it, we fought for independent restaurants and we were able to get it for over a hundred thousand restaurants. There's a hundred and seventy seven thousand more restaurants that signed up for it that didn't get it. And now what Congress is doing is there in the business of choosing winners and losers rather than refilling it as Senator

Senator Schumer promised he would. He promised this was a down payment on the rest of it. And what we need them to do is we need to kind of belly up to the bar, pay for this and help us get to the other side of this, because if they do, I promise you, they will be saving millions of jobs. And those are jobs ultimately that they're not

going to have to take care of down the road. David, just very briefly, in the last minute we we have with you, you may make the case here and talk a little bit of the scarring that that could occur to the industry into cities and towns throughout the country if independent restaurants don't get this aid. Yeah. Well, this is a simple case to make, right. We um produce more to the GDP than almost any other industry. We

provide more jobs than almost any other industry. We're talking about fifteen million jobs and counting that our industry in independent restaurants alone provide to our economy the amount of tax revenue to our cities. All of that is why our industry is worth saving. And most importantly, something we need to remember is you don't need a college degree, and you don't even need a high school degree to get into the restaurant industry to make it into the

middle class. If you work in our industry, work your way up, you can open a small business. And small businesses the cornerstone of our economy. Yeah, well said small businesses, certainly the cornerstone, and she point out restaurants really the lifeblood of so many communities and so many of our cities out there. It's kind of what makes our cities cities. David really appreciate you take a time to be with us,

and we wish you the best. David Mayfield there, he's a part of the Independent Restaurant Coalition and he's an owner and chef of KFICO out there in San Francisco. Of course, the solution to all this is getting the COVID crisis under control. We're gonna talk a little bit more about the COVID crisis and some new recommendations by the CDC. This one applying to cruise ships. We're gonna talk about that and so much more right here on Bloomberg.

This is Bloomberg Market Special coverage all week long, simulcasts across Bloomberg TV, radio and YouTube. We welcome all of our audiences across all of our platforms. Remain bostic here alongside Tim Stenovik and Created Gupta, we're gonna be counting you down to the close of trading on this Thursday afternoon, just about one hour away. The SMP five hundred camped out at another record high, as is the Dow Jones Industrial Average, and NAZDAC one hundred came within just a

few points of that record high. As far as the individual mover as well, it's kind of a mixed bag here. You have names like Apple not going much anywhere, basically flat on the day, Ford shares, which had been higher flat on the day. Uh, And then you got stocks like Peloton, like Zoom, A lot of these sort of memes stocks, I guess if you call them memes or pandemic blaze seemed to be back and focus, no real news. They're uh, crety with regards So what's moving those stocks

and why? But I've seen a pretty significant drump Peloton shares up about nine percent right now. You know, even with the holiday trading, that quiet volume is still those names that seem to really become kind of familiar plays when it comes as hedges on the omicon variant, perhaps, or perhaps just the fact that those are the stocks that have been getting battered lately. So why not by the dip there? Yeah, Hey, does Apple hit three trillion by the end of the year. Uh, well that's tomorrow.

I know you think it would happen tomorrow. We're saving it for them. It would be appropriate if it happen tomorrow. We're gonna do the show from Time Square, so the confetti we'll be ready here. Let's uh, we're gonna go get to our guests, Jason Pride in just a moment, but we want to jump over to Abigail do a little real quick, who is not in Times Square, but

she's keeping a eye on the markets. I'm certainly not in Times Square right here at headquarters at lex and yes, everything that you guys have been saying, you know, steady as she goes Cruise Control rally, the SMP five hundred up three of the four days this week, interestingly, the NAZAC.

This is the nazac's first update this week, climbing still not hitting a record high, nonetheless that stands out and speaking of trends, crude oil and it's best up streak going back to February now relative to that strength with the NAZAC, and I of course should say the SMP five likely to hit another record closing high seventy one of the year. Really pretty incredible and a third big up gear in a row. But the NAZACUT performance is

coming from China Tech. It's a incredible the Golden Dragon NAZAC et f or index excuse me, up more than ten percent today. That is the best day going back to two thousand eight. However, into today on the year, it had been down almost fifty so talk about catchup falling night. But that's what's happening with Bai Dow and Ali Bob and a number of those other stocks really helping out again the NAZAC and the New York Fang Index. A comment on about what you just said was what

is happening in the commodity space. Have we hit the peak in the commandity rally or is there room to run? Well, you know yesterday Creedy, you're asking about the dollar. It's interesting a lot of people seem to think that the dollar is going to go higher. If that dollar strength reflects a strong economy, you could probably see commodities continue

to go higher. However, if the dollar goes higher and there's not quite as much of economic strength, there's more of the inflationary pressure on the dollar, it would be interesting to see whether or not oil can hang in there or not. Technically it's somewhat strong, but the commodities like box create a tremendous year. The Bloomberg Commodity Index up more than this year Oil, I think up more

than Can the rally continue? I think it's really going to come down to the fundamentals there in terms of the economic growth, will it or will it not be there? And in the beginning of the year, how much we will o macron impact. Let's see if we can get some answers to that from our next guests. Our thanks there to Abigail Doolittle giving us a nice little runway

here to start off with. Jason Pride, he is uh the chief investment officer over for Private Wealth, I should say over at Glenn made about forty billion dollars in assets under management at the firm. Jason, let's look ahead to two here. I'm sure all clients have to be asking you kind of what to expect given how phenomenal this year was for at least most asset classes, and how unlikely some of those gains probably were at least you know when you look at where we were at

the start of the year. Yea, absolutely, and thanks for having me on Romaine. Uh. This is this is an interesting environment that we find ourselves in as we look forward to two twenty two. We think the games are probably gonna be more modest than they've been the past uh years, So basically just to the magnitude that we've seen in two thousand twenty one and the valuation point that we're starting with as we enter two twenty two. Having said that, we think there's some reason for optimism

for investors. The primary reason is actually that we're just still in a recovery from the pandemic, and that recovery comes with an expansion of the economy and expansion of profits for corporations, and a good fundamental picture heading into two thousand twenty two, we expect there to be growth and earnings growth and pay for consumers, growth and revenues at the top line for businesses, and therefore an underpinning for a rising stock market, offset to some degree by

the premium valuations that we enter the year at two. In two thousand twenty two, Jason, help us understand what you're factoring in from a policy perspective, What do you what are you expecting in two both when it comes to fiscal policy and monetary policy, And that's that's one of the key questions that we think that there is for two is what does the policy framework look like?

And let's address two aspects of policy, one being monetary policy and two being fiscal But basically the big picture for both of them is they are going to both be a headwind for the economy and for the markets in two thousand twenty. One of the reasons for it to be to be softer. Fiscal policy is going to come in some on the ballpark about two hundred and fifty billion dollars spend next year. That's of substantially from the two trillion dollars spend in two thousand twenty one.

And monetary policy, we know is going to be We're going to see the FED tapering its balance sheet or tapering its purchases, adding to its bound sheet, and also talking about raising rates in two thousand twenty, which we think will actually probably start somewhere in the middle of

two thousand twenty two. You put those things together, and it's a headwind for both the economy and markets, but it's not an insurmountable headwind, which is one of the reasons that we think we'll probably still see gains, just not gains there nearly as big as what we send in two thousand one. Well, Jason, help me out here, because I'm a little bit confused about where we are

kind of in the economic and the market cycle. I mean, traditionally, after you come out of recessions, you're supposed to see a little period of small caps, commodities, those riskier assets, even emerging markets really excel. And we got part of that trade, the commodities rally for example, that ab Gail Doolittle was just talking about. But then we go kind

of back in that defensive trade. Does that mean that kind of early part of the expansion of the recovery of the cycle that we've just accelerated passed through it so I think there's a couple of answers to that. Number One, are we passed the early stage and into the mid stage of the economy and the expansion. We think yes at this point in time, but it's kind of a weird mid cycle stance, one that we've kind of oscillated back, as you mentioned, back and forth between things.

They're typically recovery trades due to the inflation cycle, due to additional variants being being you know, coming forth from uh, the COVID crisis um. At the end of the day, what we think investors need to do is look at this as an ongoing economic expansion, look at what investments have participated in, what has not participated. Something has participated really well, when probably expect a trade off back to something that hasn't participated as well. A great example of that,

we think is small kept securities. Small kept companies have not they participated early in two relatively well late two even, but they've actually backed off in the relative performance through two one. We think they're probably setting up for another run about performance due to that relative underperformance of the tail into two thousand twenty one. Another area that we

think is interesting is real estate. Real estate has been kind of an unloved, relatively hated environment and and portion the market due to people's concern about people simply staying home and away from work, and therefore they're being less demand from corporate real estate. We think it's actually uh significant misperception is that how much demand for corporate real estate will back off, And even a misunderstanding is that how much of corporate real estate is actually delicated dedicated

off a space. It's a fairly small minority that's office space. The rest of it's used for other things that are highly productive. A big thank you to Jason Pride, chief investment officer for Private Wealth at Glenn Meade. Happy New Year, Jason, thanks so much for for joining us. Hey, I mean the conversation continues creating about what when it comes to real estate, I mean, what it looks like on the other side of the pandemic and when we get to

the other side of the pandemic. I mean, think about the conversation we had yesterday about return to the office. A company like Facebook just delaying that but still investing in in corporate real estate. Yeah, we're not even just talking my real estate here. That same psychology expands of things like I'm cultural Land, Timberland, a lot of these other just space kind of questions that you really need. And it really all depends on really just one thing,

and that is, of course the COVID nineteen virus. But the conversation that has to be I guess is are we talking real estate and aggregate or are we looking at certain pockets here. I mean, there's still areas of the commercial real estate market that are just just still completely beaten down. I guess there's a rotation a little bit. I guess based on where we're living, where we're working, and what we're doing here. But it seems like you have to be a little bit choosy about where exactly

you choose with your money. Look, that's a really good point. You can't say that the residential real estate by any means has been unloved over the last year throughout the pandemic. This is Bloomberg Markets, a special simulcast all week long here,

broadcast across Bloomberg TV, radio and on YouTube. Romaine Bostic Tim sent off Creaty Group to counting you down to the closing bell on this Thursday afternoon, just a little more than twelve minutes to go here, the SMP five hundred, which had been higher here for a good portion of the day, turning red right now. As far as some of the industry groups here, you can take a look, or you could take a listen here and see where

we are right now. You talk about some of the tech stocks, they've actually kind of weakened here as we've gotten a little bit closer to the closing bells here on this day, you're seeing a little bit of a bid uh come in late into some of those names. We should point out a lot of the travel stocks, including the cruise lines as well as some of the airlines and hotel stocks, UH, Tim and Creaty are moving

lower here. That largest seems to be on the back of that announcement we had a little bit earlier today from the CDC advising against traveling on cruise ships. You know what's interesting, Romaine, is the ones that are performing better. Actually, you're actually seen some of those farmer stocks actually higher, and they like sud Visor, Johnson Johnson, some of those vaccine stocks really kind of paving the way. Uh. This

comes after, of course, yesterday biotech was kind of the laggard. Yeah, and as you mentioned Romaine, Big Tech weighing down the SMP five hundred, Microsoft, Tesla, Apple, and Video A M d all leading the way to the downside on the SMP. All right, let's get some broader perspective as to what's going on now and maybe what to expect in two. Joe An Feeney joining us right now. She's partner and portfolio manager at Advisor's Capital Management. Joanne, always wonderful, Uh

to have you here on the program. Um, let's start off with two. Uh, the gains we saw in is there I guess a fundamental reason to expect that those gains can continue into the next year or me, Hello everybody there, Um, yeah, I mean not certainly, not to the same extent, but to degree that earnings growth is expected to continue at a pretty decent pace next year, you know, somewhere around the order of eight nine percent.

And that does give a lot of reason to be confident that equities, some equities can continue to move higher. But just like we saw last year, we shouldn't expect a lot of consistency across different kinds of stocks. And so picking your places, I think it's gonna continue to be pretty important. Okay, So speaking of picking picking your place, where should investors be thinking about putting their money. Well, there are three areas we think continue to be really

important to remain exposed to. One of them certainly is secular growth. There are a lot of good multi year expansions ongoing, and the companies that are key providers in those areas are likely to see their sales and earnings growth continue at a pace well above the market average. I mean this could be companies exposed to five G two data center expansion. The housing market we think continues to grow pretty strongly given the backlog and demand that's

sitting there. So names like Broad Calm or a Corvo on the smaller side, Lenar we like in the housing space, and william Sonoma because people are gonna put stuff in those houses, from furniture to two kitchen gadgets. So those are couple areas we like. But beyond that, you know, go to defensives and go to the reopening place. Joan, you caught me when you said five G there, and then you really got my attention when you said defensive

and big tech. I'm curious, though, how much of the geopolitics kind of factors into all of this, especially when you're talking about the tech sector and perhaps Joe Biden's mission to bring some of that capacity back onto US soil. Yeah, that that is going to be a tricky, uh, you know, a set of waters to navigate, because politics always it is hard to predict, and it always it throws a

bit of a monkey wrench into things. But if you step back and look at the equipment that has to be built, the devices that will continue to be built five G, right, we're still in some of the early innings there of those devices being rolled out, and so you know, I think that some of these companies are really beyond the politics, like a Core, for example, providing really key inputs into smartphones five G enabled smartphones, but also providing some key equipment into the defense industry UH.

And Broadcom is another one with their filter technology as well as their ability to sell into data centers, which will need to expand by the way as five G growth because more streaming, you know, more data flowing across the Internet and the seller uh networks will drive up that demanded And I think those two companies, you know, for two, are are probably well out of the way

of the political turmoil that might be devil some other companies. Yeah, and when you talk about some of the other sectors, particularly healthcare, which has done pretty well this year, particularly some of the pharmaceutical companies, and obviously the boosts that some of them got from the COVID crisis, and to a certain extent some of the medical device companies which had actually started to rebound later in the year. Here, what's the general thinking right now with some of those names.

Do they still look attractive to you? Yeah? You know, go back to the fundamentals on healthcare, right. The demographics are really an important driver longer term, right, And the aging population, not just in the US but around the world will demand greater innovation in healthcare. And so, you know, some of the areas we like our the equipment, the analytical equipment providers, whether it's a Thermo Fisher or an

adult for example. And then beyond that too, I think the question you were really asking Romaine is you know, what about these farma what about BioNTech or Advisor? Um We still like both of those um as we can see COVID uh, you know, may continue to have surprises

for us with new variants. We certainly gotta wake up call with Omicron, and what we're seeing is that these mr and A technologies, particularly from BioNTech, are really good at creating the T cell response, which seems like it's helping to prevent the severe illness UH for folks that are vaccinated. And so we think that that stock has more room to run as boosters become more prevalent around the world and Israel potentially even going to a fourth shot.

But be on that. We really like the pipeline of a company like bion Tech UH in their other m RNA based therapies, whether it's a flu vaccine or cancer treatment. So while it's gotten a lot of attention because of COVID, we own it and we've owned it for our clients for a while for reasons that go well beyond the current crisis. All Right, a lot of opportunities ahead for rent. Conversation right now with joe An Phoeney, partner and portfolio

manager ED Advisor's Capital Management. Thanks for listening to Bloomberg Business Week. Download the podcast on iTunes, SoundCloud, or Bloomberg dot com, and you can also listen to our radio show at two pm Eastern on Bloomberg Radio or watch us on YouTube search to Bloomberg Global News,