Stocks are doing their best to climb out of the pit they found themselves in when the opening bell rang this morning. Political unrest in Hong Kong is being blamed for the slide.
As Michael Crofton, CEO of Philadelphia Trust told Yahoo Finance, “The market is looking for a reason to go down. The geopolitical concerns give it a reason.”
Crofton says the unrest in Asia won’t be particularly long-lasting and so “the market’s using that as a chance to take some gains, to move to the sidelines and I think to set itself up for a pretty good fourth quarter.”
As for how to play this dip, ahead of that “pretty good fourth quarter,” the Philadelphia Trust chief says to look toward domestic energy. “Typically oil goes up with these geopolitical uncertainties,” he notes, “...and it hasn’t happened this time which I think is an aberration. You’d be well served to find some oil stocks, natural gas stocks.”
If Crofton is mistaken and political unrest in Hong Kong lingers then it could send markets even lower at which point he sees the silver lining of a “much bigger opportunity at a later date to buy this market significantly cheaper.”
October fright fest
This all comes just before the start of one of the scarier months in the trading year. October has long been frightening to investors but Crofton shrugs it off. “I think October could be scary but look, if you’re picking individual stocks and you use these periods of sell-off to position the shares you want to hold for the long term... if you want to position stocks in companies that have underperformed and that still have good potential it’s a great opportunity to do that."
What companies fall into the category? Check out part two of our discussion with Michael Crofton tomorrow.
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