If the tariffs promised by Trump are introduced, the shares will suffer, says Jeffrey South of Raymond James.
“If this results in a full-scale trade war, where there will be a” bottom “- it is unclear,” he emphasizes, recommending that investors stay aside until the situation becomes clearer.
On Thursday, Trump announced plans to introduce tariffs for imports of steel and aluminum. After the release of these news Dow lost 3%, and the S & P 500 – 2%.
However, the growth of the economy and profits of companies can provide fundamental support to the shares over the 10th anniversary. In addition, South believes that the underinvestment is a “bullish” signal.
“In the short term, these tariffs will become just a noise for the market, which may be an opportunity to buy in the long term,” he adds.
South does not recommend buying shares, as they can test corrective lows in February.
“Do not catch a falling knife,” he concluded.