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Volatility will dominate market in year’s second half: John Stoltzfus

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Market bull John Stoltzfus sees ways to make profits in the year’s second half, but it won’t come easy.

The Oppenheimer Asset Management chief investment strategist warns the wild swings won’t subside anytime soon due to how traders and nervous investors are reacting to headline risks.

“They’re waiting for some catalyst to cross the tape that will justify taking near-term profits without FOMO, or fear of missing out,” Stoltzfus told CNBC’s “Trading Nation” on Wednesday. 

Stoltzfus notes there are several risk factors to consider, particularly the spike in coronavirus cases and whether a vaccine will become a reality.

“What’s going to keep traders on their toes will be developments related to the Covid-19 pandemic,” Stoltzfus said.

He also lists the Democratic Party’s choice for its vice presidential candidate and second-quarter earnings season as potential near-term downside catalysts. 

Yet, Stoltzfus doubts the latest jitters will derail the new bull market. He calls the market “resilient,” citing the historic rebound from the 2008 financial crisis and from the coronavirus-induced March low as examples.

“We’re going to see another round of emergency stimulus put forth for the economy that should be good for both Main Street as well as for Wall Street,” he said.

Stoltzfus’ second-half playbook

When the coronavirus outbreak began spreading globally in February, Stoltzfus, who came into 2020 as the Street’s biggest bull, got cautious and warned investors there was nowhere to run

He suspended his S&P 500 year-end target of 3,500 on March 23, the day of the market meltdown. Since then, the index has surged 42%.

During that period, Stoltzfus started getting more constructive on stocks, highlighting technology as one of his top plays.

The pockets he likes best include economically sensitive stocks that should do well as the recession ends. 

“We like consumer discretionary. We also like industrials, because industrial stocks today use a lot more technology than ever before,” Stoltzfus said. “As a contrarian pick, we like financials — which we think is a misunderstood sector in a world that needs big financial companies to finance the new economy that we’re moving towards.”

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Venezuelan court sentences 2 former Green Berets to 20 years in prison

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ID cards of people linked to an operation denounced by Venezuelan President Nicolas Maduro are displayed during a meeting with members of the Armed Forces in Caracas, Venezuela on May 4, 2020. Venezuela’s President Nicolas Maduro confirmed the detention of two US “mercenaries” among 13 attackers involved in Sunday’s two failed maritime raids.

Miraflores Presidential Palace | Anadolu Agency | Getty Images

A Venezuelan court sentenced two former U.S. special forces soldiers to 20 years in prison for their part in a failed beach attack aimed at overthrowing President Nicolas Maduro, prosecutors announced late Friday.

Former Green Berets Luke Denman and Airan Berry admitted to taking part in the May 4 operation orchestrated by a third ex-U.S. soldier who remains in the United States, Venezuelan’s chief prosecutor Tarek William Saab announced on Twitter.

“THEY ADMITTED THEIR RESPONSIBILITY FOR THE FACTS,” Saab wrote, adding that the case will continue for dozens of other defendants. He did not offer details.

“Operation Gideon” was launched from makeshift training camps in neighboring Colombia and left at least eight rebel soldiers dead while a total of 66 were jailed. Former Green Beret Jordan Goudreau, who operated a private, Florida-based security firm called Silvercorp USA, claimed responsibility for the failed attack.

Venezuelan prosecutors announced that Denman and Berry, both decorated former U.S. service members, were found guilty of conspiracy, trafficking in illegal arms and terrorism.

The two Americans arrested in the coastal fishing community of Chuao have ever since been widely displayed by officials on Venezuelan state TV as proof of their long-held claims that the United States is set on overthrowing Maduro’s socialist government.

The incident also unleashed claims that U.S. backed opposition leader Juan Guaido had authorized Goudreau through a signed agreement to carry out the attack, executed by two of Guaido’s former political advisors.

Guaido and U.S. officials have denied any role in the attack. Secretary of State Mike Pompeo said Washington would use all possible means to win the freedom of Denman and Berry.

A day before authorities announced that the two ex-Green Berets were sentenced, Venezuelan authorities opened the trial of six American executives of the Houston-based Citgo company. The six men were arrested over two years ago in Venezuela on corruption charges.

The case had lingered for months until former New Mexico Gov. Bill Richardson met personally in July with Maduro in Caracas to urge they be released so they could return home to the United States.

Both play out amid hostility between Washington and Caracas. The Trump administration last year threw its support behind opposition leader Guaido, who declared he was Venezuela’s legitimate president, vowing to oust Maduro.

Guaido blames Maduro for the once wealthy nation’s economic and social collapse, while the socialist leader says Washington is manipulating Guaido to steal the nation’s vast oil wealth.

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As Trump bans WeChat, some in China turn to encrypted messaging app Signal

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The Signal Messenger app is displayed on a smartphone in Hong Kong, China.

Roy Liu | Bloomberg | Getty Images

President Donald Trump’s executive order banning American use of WeChat, the most popular app in China, takes effect next month, but some in China are already turning to an American app renowned for its privacy protections.

Downloads for Signal, an encrypted chat app that privacy advocates generally regard as best-in-class for everyday use, are spiking in China, a spokesperson for the app said Friday.

The Chinese government heavily regulates domestic internet use, funneling most of its citizens to WeChat, a multipurpose app that offers messaging, games and ridesharing options, among other uses. On Thursday, Trump, citing the likelihood that WeChat sends users’ data to the Chinese government, signed an executive order banning people and companies in the U.S. from engaging in “any transaction” with the app beginning Sept. 20.

It’s unclear whether that would require U.S. companies to cut off access to the app, but the order comes as Trump has threatened broad bans on Chinese tech companies operating in the U.S.

China’s Great Firewall, a censorship system that restricts citizens from directly visiting much of the internet, bans easy access to most other major Western chat programs. While a comparatively small number of Americans use WeChat, a ban would hamper those who use the app to communicate with friends, family or business associates in China.

But Signal isn’t blocked by the Great Firewall, both for iPhones via the App Store and Android via a direct download from Signal’s website, as Google’s Play Store is blocked.

“We are actually not banned in China, believe it or not,” said Jun Harada, a spokesperson for Signal.

While he declined to share actual download numbers because of a policy of not sharing user data, he said downloads in China began to skyrocket in the hours before Trump’s ban. “It’s looking to be on par if not bigger than when we made it to #1 in the App Store in Hong Kong,” he said, referring to a spike in downloads there last month, when China began implementing its National Security Law, which gave the country broad powers to crack down on protests in Hong Kong.

“We think that has helped us to get more mainstream awareness within China but also with the Chinese diaspora,” Harada said.

Signal gets high marks from privacy experts because it stores little information about its users and its messages are end-to-end encrypted, meaning a government that accesses them in transit would only see them encoded.

Yaqui Wang, a China researcher at Human Rights Watch, said she has long used Signal to communicate with people inside China, but cautioned that the government there could move to block it if it catches censors’ eyes, making it all the more difficult for people in the U.S. and China to communicate directly.

“Chinese authorities can block Signal if its popularity surges, just as it did to WhatsApp and Telegram,” Wang said.

“The bifurcation of the internet, the formation of two paralleled information and communication universes is becoming increasingly evident,” she said.

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City in China’s Inner Mongolia issues warning after bubonic plague patient dies

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Authorities in a city in the Chinese region of Inner Mongolia issued a warning after a patient who had bubonic plague died of multiple organ failure, state media reported on Saturday.

Cases of plague are not uncommon in China, although outbreaks have become increasingly rare. From 2009 to 2018, China reported 26 cases and 11 deaths.

The patient was confirmed to have bubonic plague, the People’s Daily reported, citing an announcement from the health committee of the Bayan Nur city. The bubonic plague, known as the “Black Death” in the Middle Ages, is a highly infectious and often fatal disease that is spread mostly by rodents.

The committee issued a third-level alert, the second lowest in a four-level system, effective Friday to the end of 2020 to prevent the spread of the disease, the People’s Daily reported.

This marks the second death of a plague patient reported this month in the Inner Mongolia region.

Residential buildings in Baotou city, Inner Mongolia.

Simon Song | South China Morning Post | Getty Images

On Thursday, authorities in Baotou city, which is adjacent to Bayan Nur city, reported that a patient with an “intestinal-type plague” died of circulatory system failure.

Bayan Nur authorities have locked down the area where the dead patient lived and quarantined seven close contacts of the patient, who have tested negative for the disease so far and taken preventive medicines.

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