Market Call:

Andrew Hamlin, vice president & portfolio manager, Aston Hill Asset Management

FOCUS: North American Income Stocks

Market outlook:

Anxiety levels amongst investors out there remains elevated ever since the day after the referendum in Greece (June 29th). Internally we have been talking at length about whether the Greek issue is enough to knock the market off its highs. The conclusion is that the Greek issue in isolation is not enough to cause massive weakness in North America.

The caveat is, though, Greece causes uncertainty and markets hate uncertainty (especially when at historic highs), so hence the recent flight from risk assets (equities, high yield, other currencies). Now, the bigger issue is what is happening in China and this could very well have a spillover effect globally, but it is too early to tell. There is a vacuum of information out there that is driving volatility. What do I mean by this?

Well there has been very little incremental information out these last few weeks, aside of course form Greek Circus. This coupled with reduced liquidity in the China market has created an environment of extreme volatility.

The news vacuum will change next week as the calendar is full of catalysts: heavy earnings calendar, lots of China eco data, ECB meeting, Yellen's press conference, etc. In the U.S. it is all about earnings. What should investors do?

Don’t get spooked by all this noise. Don't follow the heard and sell. Focus on favoured names that have sold off and think long term. Remember, dividends provide a great cushion to total returns.

Add to high qulity dividend names and collect that cash flow - these names are cheaper now and the yields are greater. Let’s not forget, will all the anxiety out there one would think the market is down more than it is. It is only down 3.5% in the U.S.

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