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Major indices open in the green on stimulus hope

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Arian Vojdani, MV Financial Investment Strategist, joins Yahoo Finance’s Alexis Christoforous, Brian Sozzi and Jared Blikre to discuss the latest market action.

Video Transcript

- We're joined now by Arian Vojdani. He is a financial-- MV financial investment strategist. Thanks so much for being with us. We appreciate it.

We're seeing these huge swings in the market-- one day up big, one day down big. Is this just the new normal for Wall Street right now, do you think, Arian?

ARIAN VOJDANI: I think for the time being, it definitely is the new normal. I don't think this is going to go anywhere. And I have to say investors should brace for continued volatility and potentially increased volatility. We know that we're on the onset of this thing. I think there's more pain ahead in the markets. We'll continue to have relief rallies and days like this, so I don't think it's going anywhere. I think investors should act accordingly.

- And what about opportunities? Are you taking advantage of this market right now/ What are you telling clients? Are you seeing that they want to hold on to cash? Are they running to treasuries? What are they doing right now?

ARIAN VOJDANI: It's a great question. There is a lot of fear. This is a heightened fear environment for multiple reasons. I wouldn't say it's time to sell out yet depending on your timeline. However, opportunity will come. I don't think we're in the thick of it yet, so I think opportunities will get better. I think the market will become more attractive in terms of long-term buying opportunity. I just don't think we're there yet. I think now is a time to brace yourself, hold on, and not make any sudden, knee-jerk moves.

- All right. Arian Vojdani, we're going to ask that you stick around. We're going to take a quick break and come right back with much more market action here at Yahoo Finance.

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- All right. We're about 4 minutes into a new trading day. Stocks are rallying. We have the Dow Industrials up better than 1,100 points right now, being led higher by shares of Boeing, up about 18% right now. Chevron and United Technologies higher as well. Joining us is Arian Vojdani, Investment Strategist at MV Financial. We also have Brian Sozzi here with us. And Brian, I understand you have a question for Arian.

BRIAN SOZZI: Yeah. Arian, good to talk with you here. What do you make out of, let's say, the president [INAUDIBLE] adjusting, people go back to work, but we still have coronavirus cases on the rise? From an investment standpoint, doesn't that worry you a little bit, and how do you position for that? Because theoretically, [INAUDIBLE] coronavirus numbers will continue to rise, perhaps, pretty big.

ARIAN VOJDANI: Yeah, it is confusing given the messaging recently. The best thing for the markets will be for this thing to move on, pass. So we need to do everything-- or really, we need officials to do everything to make sure that life can go back to the way it was, right? Economic shutdown around the world is what's hurting the markets, the uncertainty from that. So if we do something that endangers our ability to get back out there, that is worrisome for the market outlook.

- Arian, I love your take on the airlines, because they are rallying today after being beaten down, but it seems like everything is rallying. All 11 sectors of the S&P 500 are higher here as well as we're seeing this has bounce back, at least a temporary bounce back. There is talk that domestic passenger flights could virtually come to a halt, in essence grounding the entire US airline industry. If you're holding airline stocks right now, what do you do?

ARIAN VOJDANI: It's a great question, Alexis. I think you hold. I think there is pain ahead. I don't think this rally is going to persist. We're going to see things slow down. We know that this is going to continue on. However, there's no reason to believe that the airlines are going to go somewhere. We know the government is going to come in and help them. But also, what other alternatives are there when the world goes back? Those airlines have a firm footing. And I think the selloff has been a little bit drastic up to this point.

So maybe we're seeing a little bit of buyback because we understand the markets react ahead of time and have really reacted really negatively. So selloff might have been a little bit drastic and dramatic. But I do think there's still pain ahead.

BRIAN SOZZI: Arian, what other-- Arian, what other sectors are you looking at right now? We're starting to see cyclicals outperform defensives. Is that the good trade to be [INAUDIBLE] on?

ARIAN VOJDANI: I would still put my money on defensives. I think anything that can outride this kind of environment, so anything that-- you know, communications, staples, companies that will continue to produce revenue through a shutdown phase for the short term and intermediate will be strong. I still like those. I think that there is going to be opportunities. Obviously, tech is going to continue to be strong.

I would not buy into a relief rally like this. I would think that they're premature, and I think that you could get hit on the upside. Because I do think, again, we're going to start to see data come through, and the data will really help us guide what stocks, what positions are going to be the winners throughout this negative period.

- Arian, we're seeing the past 24 hours, 36 hours, a lot of Wall Street firms are actually taking their estimates for the market off the table. They're saying there is much uncertainty, we can't even guess where the S&P 500 is going to end this year. Are you in that camp, or do you actually have some forecasts for us?

ARIAN VOJDANI: I actually am more in that camp. You know, if we look back at historic data, there's nothing in the playbook that covers this kind of event. We keep talking about the Great Depression and the Recession. Those are such different events. We've never seen an event which has shut the entire world down.

So really, our best estimates-- we're looking at different scenarios when we talk in our internal investment community about how long the shutdown lasts and how that affects the U curve, as it were, of how badly it affects the economy. That's what we need to look at. Is this thing two to four months? Is it three to six months? It is it potentially longer? Because every time that scale goes longer, the longer and potentially more deep you will be. And that's not something any of us as investors want at this time.

- And what do you do if you do-- let's say over the next couple of weeks-- we had [INAUDIBLE] suggest 30% unemployment rate. I would imagine if you're going long here, seeing that number potentially cross the tape is jarring. It's shocking. You [INAUDIBLE] a print like that.

ARIAN VOJDANI: Yeah, that is very troublesome, 30% unemployment. Honestly, we've never-- you know, the Great Depression was 20%. That was a very different market period, and again, a tough comparison. A 30% unemployment period would be very hard on the markets. And I think, to your point, this is-- you have to look at this as a long-term play.

If you're someone more short term, intermediate, like some of our clients, people who are getting ready to retire, there are going to be-- there is going to be some pain for those kind of people in their portfolios. If you're more long term, you would hope that would wash out. But again, that 30% is the most bearish of estimates. I do think that we're going to see a lot of unemployment. We're seeing a lot of data come through which is troubling as is. And I do think we're going to have to, again, see how long this thing lasts, because that is really what's going to drive these different data points.

- Airan Vodjani, Investment Strategist at MT Financial, thanks for your time today, and be well.

ARIAN VOJDANI: You as well. Thank you.

- Thanks. All right. Coming up next, we're going to hear from the governor of Connecticut in today's "Influencers with Andy Serwer." You stay with us.

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