Keith McCullough: Sell Stocks, Now!
It seems a growing number of money managers are convinced the stock market has legs. But not Hedgeye’s Keith McCullough.
Around 11:45am on Thursday, he went short the S&P.
“In the end economic gravity matters and I expect growth will slow,” he says.
McCullough believes the global economy is facing strong headwinds such as the higher price of oil . In turn, he believes growth world-wide will be challenged.
In fact, McCullough argues that latest data out of Beijing confirms his thesis.
Foreign direct investment in China fell 8.7 percent in July, the government said on Thursday.
"The slowdown in world economic growth, increasing uncertainties and a lack of proper solution to the European debt crisis" were external factors contributing to the decline, said ministry spokesman Shen Danyang.
McCullough expects to hear similar commentary from elsewhere in the world, and not just in the near-term, but for a whole to come.
“We see poor growth as a protracted and structural thing. Therefore I see no reason for a rotation (to drive investors out of bonds and into stocks.)”
And without a meaningful rotation, McCullough sees no reason for the rally to endure.
Posted by CNBC's Lee Brodie
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Trader disclosure: On August 16, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Brian Kelly is long TGT; Brian Kelly is long XHB; Brian Kelly is long GLD; Brian Kelly is short DLTR; Brian Kelly is short DG; Brian Kelly is short FDO; Mike Murphy is long AAPL; Mike Murphy is long SBUX; Mike Murphy is long TWI
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