Ronald Temple, co-head of multi-assets and head of U.S. equity at Lazard Asset Management, did an awesome interview on Bloomberg this morning. Mr. Temple said, “I do think there’s still downside ahead of us actually in terms of the backdrop for the fourth quarter I think it’s pretty challenging at this point and admittedly you know if we look at what happened over the weekend with the loss of Ruth Bader Ginsburg.
I think the debate over that vacancy could suck what little oxygen was left in the room out of the room in D.C. and so you know there’s an increase in partisan animosity in the run-up to the election. If I think about that combined with a resurgent COVID-19 pandemic in Europe and the arrival of the flu season in the U.S., you’ve got quite a few things lining up against the optimistic view. The probability of another stimulus act is probably going down even more with this news so with all that as a backdrop, I guess when i look at the market and what we saw in the last few weeks and months was a speculative froth around some of the growth stocks in the market and in particular what we saw in August with retail buying significant amounts of call options, many of them literally with one or two days to maturity, they might as well have been playing the slot machine.
The Nasdaq rose 82 percent from the bottom in March on March 23rd to the peak on September 1st. The S&P was up 63 percent. With the open, the S&P will be down just shy of 10 percent. We could easily have another 5 percent to 10 percent downside from here.”
Ronald Temple, co-head of multi-assets and head of U.S. equity at Lazard Asset Management, says it is time to step back and take a long-term view of markets as he sees a challenging backdrop heading into the fourth quarter. He speaks on “Bloomberg Surveillance.”