A Comment -- General Comments From an Expert (A Commentary)

Believes upcoming US Federal Reserve meeting will not result in interest rate hikes.
Pain on main street (job losses) has not occurred.
Believes higher interest rates are required to slow economy down.
Expecting economic hard landing on the horizon.
Stock price P/E ratios need to fall in order to align with historical averages. 

Understand your investments:

Warren Buffett said it best: “I never invest in something I do not understand.” Seriously, how many current cryptocurrency investors do you think actually know what they are doing? We always get customer questions on market-linked guaranteed investment certificates or principal-at-risk notes. Even with 40 years’ investment experience, we can barely get through all the documentation and risk disclosures that come with these products.

There are now leveraged single-stock exchange-traded funds (ETFs). There are leveraged ETFs where you are promised two or three times the return of some specified investment or index. You can buy ETFs that go up when the market goes down, or ones that go up if volatility increases.

We like to keep things simple. If you can’t explain an investment to your 10-year-old, you are probably taking on too much risk.
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Oil's steady move up could affect the Fed's decision on rates this Wednesday. Diesel prices have gone way up and refineries may move more into diesel production and away from gasoline production. This will drive gasoline prices up even more, so therefore more inflation. This then leads to less disposable income for discretionary spending and creates a more dismal view for investors looking ahead to 2024.

Interest rates are indeed contributing to higher rents and the lack of house-building, but cutting rates will encourage inflation. Inflation will likely be around 3% for the next few months and unlikely that North American central banks will raise rates further. Expect an easing of longer-term bond yields as institutional investors lock in yields. Recent data on employment and consumer spending is mildly positive. Q3 will be mostly as expected. AI stocks are ahead of themselves. Expects interest rates to fall, and an uptick in beaten-up high-yielding utilities, pipelines and banks. But oil prices remain a wild-card, though crude and natural gas outlook is mostly positive.

Investors should be weary as markets could be choppy going into Q4.
Lots of pressure on consumers with slowing retail sales.
Student load payments & mortgage renewals weighing on economy. 
Soft landing of the economy not a guarantee.
High energy prices expected to remain as Saudi manipulates markets.

Have the correct investment expectations:

Risks widely vary across investment markets and products. Be wary of implied rates of return that sound too good to be true, because they probably are, at best, very high risk or, at worst, complete scams. Many investors get attracted to high yields: some derivative products have current yields of 15 per cent or more. But past and current returns are not the same as future returns.

A realistic long-term return for stock investors might be in the eight-per-cent range. For a bond investor, five per cent or so. Don’t chase returns. Don’t envy someone bragging about 20-per-cent returns — they are not you, and they might be taking on huge risks.

But if things do work out for you as an investor, don’t get greedy. If one of your stocks has soared, that’s great, but it likely now represents a big portion of your net worth. As such, any future disappointment in that stock is going to be far more painful. In addition to maintaining realistic expectations, we would also maintain portfolio balance and discipline — always.
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If you look at the S&P Tech Index as a whole, it's trading at multi-year, multi-decade valuations. Price to sales ratio is back to 1999-2000 levels. We know what happened after that dot.com bubble, when the tech market dropped about 82%. Not that that's going to happen, but you have to be very careful and selective when choosing technology names.

Bond yields have jumped up a bit in the last little while, oil prices are above $90 or so, and these are going to be headwinds against the market. That being said, he remains pretty constructive. 

Inflation is cooling pretty quickly, down to about 3.7%. Yes, it was higher YOY as reported yesterday, but the core inflation is still looking pretty decent, and way below the highs last summer of 9.1%. He anticipates the BOC and the Fed to stabilize rates, pause their tightening cycle, and hopeful start to lower rates mid- or late next year. Stable interest rates are good for both equity and bond markets. 

Analysts are increasing S&P 500 estimates, seeing better than expected economic data, labour force is stronger than expected, US consumer remains robust.

It could, but the bond market will still look out where the economy will land in 12-24 months. Expects a bit of a soft patch in the next quarter or two. We've sidestepped a deep recession or contraction, and equity markets look ahead 6-18 months to see where the economy will be. That's why markets are responding decently, despite August and September being weaker historically.

Generally, utility stocks tend to do well when you start to get into a more recessionary environment, so 6-12 months before we anticipate a recession. Now that we're getting into the early part of the cycle, utilities and more defensive names tend to underperform. Dividend stocks have not been performing well, because interest rates are moving higher, making dividend plays appear less attractive.

At some point,  the 10-year bond yields will start to calm down, and that's when you'll start to see outperformance in utilities, dividend stocks, banks, and telcos.

He's never considered an ETF for the telecom space. Buying an ETF is a way to diversify your risk. But because telcos  tend to have lower beta than the underlying indexes, he doesn't need to buy an ETF to de-risk. 

Names to look at include BCE (owns in his portfolio), Rogers, and Telus. They'll perform better once interest rates turn over, but the good news is that you're getting a healthy dividend yield while you wait.

The intermediate- and longer-term charts show that's still the case. In the very short term, utilities and financials have recovered slightly, but it's hard to say whether that's a new trend or just a correction we're going through. People are concerned about stability and are looking for something with a higher, safer yield. 

The data doesn't show a downturn, but that could change so he monitors it closely. We're in that historical season where markets see a lot of chop, which coincides with both the calendar and the US presidential cycle. Everything is still intact. Technical levels haven't broken down. His thesis remains that this is a correction inside the upward-trending market.

This could change if all of sudden we see some of those levels break and a leadership change as well.

Whenever the market gets a little uneasy, he definitely sees it in the small caps as well. They tend to be more volatile and liquidity dries up, so they can really get pushed around. Just as with the regular market, they tend to be fairly strong from October - end of May. He hasn't seen that leadership yet in either Canada or the US. The Russell 2000 has been in a trading band for the better part of this year; if it does break out, it will probably be pretty significant.