Nuveen’s Doll Loves Trump-Tied Volatility, Sees Pharma Gain

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  • Investors should expect noise from ‘tweet pulpit,’ Doll says
  • Doll says Congress may not support Trump drugmaker stance

Bob Doll: Trump Adds to Corrective Noise in Health Stocks

Bob Doll, the chief equity strategist at Nuveen Asset Management, said investors should welcome the sudden market swings caused by Donald Trump’s remarks because they present trading opportunities.

“We’re just going to get a little more volatility,” Doll said Thursday in an interview on Bloomberg Television. “As a portfolio manager, I love that.”

Trump, who will be sworn into office as president next week, has been more aggressive than predecessors in singling out U.S. companies for criticism, faulting General Motors Co. for moving jobs abroad and Boeing Co. for “out of control” costs. Wednesday he caused a plunge in pharmaceutical and biotech stocks after saying he’d force the industry to bid for government business.

Before Trump’s press conference, “we didn’t know what was going to happen,” Doll said. “Donald Trump is unpredictable. He’s going to play the tweet game, the bully pulpit, the tweet pulpit, whatever you call it. And that’s just going to cause noise.”

Doll joins money managers including David Hunt at Prudential Financial Inc.’s PGIM in saying investors need to focus on companies’ prospects and concrete government actions rather than Trump’s remarks. GM and Boeing have both recovered from losses tied to the president-elect’s comments.

Pharmaceutical companies should still do well, partly because of demographic trends, Doll said. Also, Republican majorities in Congress could have less interest in cracking down on the industry, he said. And even if Trump wants drugmakers to move more of their operations back to the U.S., that is a harder case to make than discouraging automakers to shift jobs that are already in states like Michigan, according to the strategist.

‘Going to Bounce’

“My guess is they’re going to bounce,” Doll said of pharma stocks. “Sort of like GM and Boeing.”

Doll said he’s bullish on the prospects for financial firms in 2017. The 63-company S&P 500 Financials Index has gained 17 percent since the November election amid higher interest rates and speculation that Trump could reduce oversight of the industry.

“If the economy gets a little better, interest rates move a little higher, if regulation gets rolled back some -- and I think the answer is yes on all three -- there’s no sector that benefits more than financials,” Doll said.