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Sydnee Gatewood
Sydnee Gatewood
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Scott Black Says the Market Is ‘Like an Earthquake’

Delphi Management leader isn’t buying even though stocks are cheap

December 28, 2018 | About:

Scott Black (Trades, Portfolio), founder of Boston-based Delphi Management, told CNBC on Thursday that even though stocks are cheap on a valuation basis right now, he isn’t buying.

The value investor said the market's problems are being exacerbated by the ongoing trade war between China and the U.S., which he said will only get better once a deal is reached. He added that the tariffs imposed by President Donald Trump have “disrupted the total supply chain,” impacting tech, logistics, auto and manufacturing companies.

Stock market indexes ended a wild week of trading flat. On Friday, the Dow Jones Industrial Average closed at 23,062.40 with a loss of 0.33%. The S&P 500 declined 0.12% to 2,485.74. The Nasdaq Composite closed at 6,584.52, posting a 0.08% gain.

While he is not buying now, Black said he is fully invested. If someone has to invest in this environment, he recommends buying domestic companies or companies with good earnings power. He suggested Walt Disney Co. (NYSE:DIS), which he has owned for years, and AbbVie Inc. (NYSE:ABBV).

He also urged investors to be cautious until the market stabilizes, comparing it to an earthquake.

“The initial one may be 7.8, but there are aftershocks,” Black said. “It’s better to wait and be cautious, because the aftershocks can still be disruptive.”

Watch the video below:c

Market is going to be in flux until we resolve tariff issue, says Delphi's Scott Black from CNBC.

About the author:

Sydnee Gatewood
I am an editorial assistant at GuruFocus. I have a BA in journalism and a MA in mass communications from Texas Tech University. I have lived in Texas most of my life, but also have roots in New Mexico and Colorado. Follow me on Twitter! @gurusydneerg

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