{"id":40689,"date":"2020-12-28T07:48:56","date_gmt":"2020-12-28T13:48:56","guid":{"rendered":"https:\/\/www.completeintel.com\/?p=40689"},"modified":"2020-12-28T07:48:56","modified_gmt":"2020-12-28T13:48:56","slug":"bfm-defensive-play-tech-stocks","status":"publish","type":"post","link":"https:\/\/completeintel.com\/bfm-defensive-play-tech-stocks\/","title":{"rendered":"Work-from-home stocks a defensive play in 2021?"},"content":{"rendered":"

In this BFM episode, Tony Nash explains the defensive play of the WFH company Keane and how it compares to other tech stocks like Tesla? Also, will the good days for the financial and energy stocks<\/a> continue? And how about the outlook for Sterling as the Brexit deal is being ironed out? Will the Pound appreciate or decline? And why there seems to be a never-ending trade war against China \u2014 now recently with Vietnam and Malaysia imposing tariffs on the Chinese steel?<\/p>\n

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This podcast first appeared and originally published at https:\/\/www.bfm.my\/podcast\/morning-run\/market-watch\/work-from-home-stocks-a-defensive-play-in-2021<\/a> on December 24, 2020.<\/em><\/p>\n

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❗️ Check out more of our insights in featured in the CI Newsletter<\/a> and QuickHit interviews with experts<\/a>.<\/p>\n

❗️ Discover how Complete Intelligence can help your company be more profitable with AI and ML technologies. Book a demo here<\/a>.<\/p>\n

 <\/p>\n

BFM Description<\/strong><\/p>\n

 <\/p>\n

As we head into 2021, will we see more work-from-home stocks being used as a defensive play? The Morning Run speaks to Tony Nash for his perspective on this, as well as his views on financials and energy stocks, the Sterling, and tit-for-tat trade wars.<\/p>\n

Produced by: Mike Gong<\/p>\n

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Presented by: Roshan Kanesan, Wong Shou Ning<\/p>\n

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Show Notes<\/h3>\n

 <\/p>\n

WSN:<\/strong>\u00a0With volumes on U.S. equities drying up ahead of the holiday season, are you expecting investors to hit the sell button or to keep this whole positions over the period? Because the market’s somewhat a little bit more happy today, a little bit more green?<\/p>\n

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TN:<\/strong>\u00a0I’m not sure, but I’m sure there is not a conviction either way right now. Investors aren’t really sure that they’re ready to pull the plug on things. People are waiting to see what’s going to happen with the stimulus funds. They’re waiting to see how smoothly the transition goes with the US government. They’re waiting to see how companies Q4 earnings come in.\u00a0So in the next few weeks, aside from some commodities play, I\u2019m not entirely convinced that we\u2019ll see dramatic movements in one way or another.<\/p>\n

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WSN:<\/strong> And I’m just curious following up on that. So for the moment, it still seems that even though the Nasdaq corrected a little bit today, the work-from-home, Keane is here to stay as a defensive play?<\/p>\n

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TN:<\/strong> Sure, that is an effective play, but the benefits or the upside to that play is really questionable. The Nasdaq has over 40% this year. When you look at the valuation multiples on some of these tech companies like Tesla, you\u2019re looking at over a thousand percentage. For some of the tech companies, you\u2019re looking at fifty to 200 to revenue.<\/p>\n

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Some of these tech companies are being played out. That’s not to say they’re going to see necessarily downside. But the upside? I don’t believe it’s necessarily as high as it has been in 2020. We have these moments in markets where you see serious upside in different sectors and then it comes down for a bit. We\u2019ve seen that in 2020. Are we going to see that in 2021? We\u2019re not convinced. That maybe \u00a0possible. But we’ve seen some pretty hard closed down for people who\u2019ve had their quickly transition to work from home.\u00a0A lot of that valuation are largely played out.<\/p>\n

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WSN:<\/strong>\u00a0If we look at the performance of the S&P 500, it was really the day for financials and also the energy stocks. Do you think these themes will continue into 2021?<\/p>\n

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TN:<\/strong> Certainly, that kind of stock are partly a result of the expectation of stimulus \u2014 whether that’s $600 to $2000 per person. There should be more transactional activity in terms of services with energy. There’s an expectation that people will start flying a bit more.<\/p>\n

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What\u2019s positive is the expectation on a \u00a0margin within oil and gas firms as they refine their products. I think that’s a bit higher as the margins of the percentage go up as the normal values go up. We\u2019ve been saying for several months that the oil prices will rise in the end of December and early Jan, and that’s playing out. We\u2019ve expecting that for about six months. But we do expect crude prices to fall going into February.\u00a0So while those margin plays are there now, we don\u2019t expect that to be there at the end of Q1.<\/p>\n

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WSN:<\/strong> Moving to the UK, the Sterling appreciated this morning on the back of the news that Brexit deal might be ironed out.\u00a0But where do you see the currency heading?<\/p>\n

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TN:<\/strong> We\u2019ve expected the Sterling to weaken a bit by the immediacy of the news. But over time, we expect the Pound to re-appreciate because we really value the U.K. There’s a lot of wishful thinking within the EU that Britain would suffer as they exit the EU. We’ve done a lot of analysis on this over the last three years and there’s really just a lot of upsides for the U.K. to separate. That’s not a political view.\u00a0That’s purely an economic view. We have expected the Pound to take a bit of a pounding in the short term. But we do expect it to re-appreciate as that separation gets in pace.<\/p>\n

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WSN:<\/strong>\u00a0Malaysia and Vietnam, they recently placed higher tariffs on Chinese steel. And although unrelated, this comes after China imposed some additional duties on various Australian imports. Do you see this tit for tat tariffs going to continue to be the norm in 2021 and no end to it?<\/p>\n

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TN:<\/strong> We’ve been saying for a couple of years that we expect trade to turn from these fairly invisible activities like subsidy to non tariff barriers, which is really regulatory into direct tariffs. It\u2019s like going back to 1980s pre-WTO where there\u2019s more of a fiscal benefit for the country than the protectionist benefit in a non-tariff barrier regulation.<\/p>\n

 <\/p>\n

Many countries are a bit tapped out on subsidies, so they’re not necessarily going to be able to pay their industry as much to protect them. So they’re going to have tariffs to generate revenue. Specifically, the Chinese steel, there\u2019s a global glut of Chinese steel, of the Hang Seng, for years. It wasn’t surprising that these tariffs have been levied because they have a little bit of it\u2019s own steel industry. They\u2019re protecting themselves from the glut of Chinese steel.<\/p>\n

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WSN:<\/strong> All right. Thank you for your time. And that was Tony Nash, CEO of Complete Intelligence, giving us his views on global markets.<\/p>\n","protected":false},"excerpt":{"rendered":"

In this BFM episode, Tony Nash explains the defensive play of the WFH company Keane and how it compares to other tech stocks like Tesla? Also, will the good days for the financial and energy stocks continue? And how about the outlook for Sterling as the Brexit deal is being ironed out? Will the Pound […]<\/p>\n","protected":false},"author":1,"featured_media":40700,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[63],"tags":[399,400,403,404,671,808,1420,1636,1852,2491,2493,3406,3539,3628,3752,3753,3772,3905,3990,4227,4228,31,4307,4416],"class_list":["post-40689","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-podcasts","tag-bfm","tag-bfm-89-9","tag-bfm-podcast","tag-bfm-the-business-station","tag-china","tag-chinese-steel","tag-energy-stocks","tag-financial-stocks","tag-global-glut","tag-malaysia","tag-malaysia-steel","tag-sp-500","tag-singapore","tag-steel-global-glut","tag-tariffs","tag-tariffs-on-steel","tag-tech-stocks","tag-trade-war","tag-uk","tag-vietnam","tag-vietnam-steel","tag-wfh","tag-wfm","tag-wto"],"_links":{"self":[{"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/posts\/40689","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/comments?post=40689"}],"version-history":[{"count":0,"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/posts\/40689\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/completeintel.com\/wp-json\/"}],"wp:attachment":[{"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/media?parent=40689"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/categories?post=40689"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/completeintel.com\/wp-json\/wp\/v2\/tags?post=40689"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}