Federal Reserve officials may be meeting next week to discuss the timing of the first interest rate hike in nearly a decade, but don't expect that higher rate to kick in for months.
Fred Tomczyk, CEO of TD Ameritrade (AMTD), says weaker than expected economic data is likely to push the Fed's decision to December - if they decide to act at all this year.
"I think the Federal Reserve is going to wait until it's sure it sees the economic growth coming and sees better signs of inflation," Tomczyk said.
A string of recent reports have showed a slowdown in the U.S. economy in the first quarter. Hiring slowed down in March, adding a disappointing 126,000 jobs last month. Consumer spending rose just 0.1% following two months of declines. Industrial output also showed significant declines, while homebuilding fell 2.5% amid a sluggish housing market.
Weak earnings reports this week have done little to change the economic sentiment. Slower trade volume led to a one percent drop in sales for TD Ameritrade's second fiscal quarter ending March 31, but Tomczyk said he remained optimistic.
"Organizations that have a lot of profits overseas, it's just the exchange rate, the sluggish first quarter and GDP," he said. "I think our organic growth is very strong, our customers are fully invested in the market, so I'm still fairly optimistic."
Specifically, Tomczyk points to the company's Investor Movement Index, which tracks the sentiment of retail investors, as proof. The IMX turned positive in March, after hitting a two-year low in February.
"It's still bullish, but I would call it cautiously bullish, not aggressively bullish like it was three or four months ago," he said.
Despite that cautious optimism, Tomczyk said international markets have made strong gains in 2015, driven by a weaker currency and aggressive stimulus, especially in Europe. Overseas stocks consistently outperformed their U.S. counterparts in the first quarter.
“When you started the year, everybody was saying the valuations looked attractive (in Europe), it was relatively a bearish market, and with the ECB coming in, and there's some green shoots right now, I think people are feeling better about the European market,” he said.
Still, Tomczyk maintains the U.S. equities market remains the best place to be, despite continued volatility in the face of uncertainty over the Fed’s next move.
"If you look at our client base, margin loans are in record territory, client cash as percentage of assets is at lows we haven't seen in a long time, you look at our net buying activity, people are definitely in the market here, there's no question," he said.