I forgot to Sell in May!
The Brexit is proving to be mind-bogglingly complex, but for those interested in the stock market, it boils down to three immediate knock-on effects:
- A potential economic slowdown reducing capital investments
- Lower consumer spending — hurting consumer discretionary stocks, and
- A stronger dollar reducing earnings for energy, materials, industrials.
Working out the impact on various sectors is complicated because almost all the players in the biggest sectors have global exposure. So simply buying consumer staples like Procter & Gamble is no panacea; they get almost two-thirds of their revenues overseas.
One thing we do know: the companies with the largest exposure overseas have already been reducing their earnings and revenue projections by a greater degree than companies with a more U.S.-based focus.