Terry Sawchuk on The Steve Gruber Show: Why Are the Markets Falling?

Jul 22, 2021 | Blog, Blogs, In the News, Market Commentary, The Steve Gruber Show

Any information discussed in this article is for educational purposes only. It is not meant to be any kind of recommendation or financial advice. The information contained in this video is intended for informational purposes only. Any opinions are those of Terry Sawchuk and not necessarily those of JW Cole Financial, Inc. or JW Cole Advisors, Inc.

Securities offered through J.W. Cole Financial, Inc. (JWC) Member FINRA/SIPC. Advisory services offered through J.W. Cole Advisors, Inc. (JWCA). Sawchuk Wealth and JWC/JWCA are unaffiliated entities.


On Monday, July 20, the Dow Jones Industrial Average fell by 725 points, its biggest one-day decline since October 2020. Many financial media headlines are interpreting this drop as a direct result of the recent COVID-19 resurgence. But is this truly the case? The Steve Gruber Show spoke with Terry Sawchuk, founder and chairman of Sawchuk Wealth, for insight.

“I don’t think it has as much to do with COVID as the headlines have led you to believe. I really think that the market got a little frothy and it’s probably time to take some profits,” Sawchuk tells host Steve Gruber. “We’ve probably been due for a correction, and to make any more meaningful gains, it seems likely to me that we will have to peel maybe 10 or 12 percent off the market from where it’s at right now in order to make another really good leg up.”

Despite seeing a potentially bigger market correction in the future, Sawchuk reiterates that he still does not believe that it will be a direct result of COVID and fearful investors.

“I think this is just profit-taking, and it makes sense,” Sawchuk explains. “We’ve had a great run since the bottom. We’re going to move into the third and fourth quarter earnings, which probably aren’t going to be as good, relatively speaking. I think we are moving into a more deflationary regime. What I mean by that is that I don’t think we are heading towards a recession, I just think that the rate of change is going to be slower in a positive direction than what it has been.”

Fortunately for investors, Sawchuk believes that even with the direction the market might be headed, there are some positives within our current environment.

“We’ve got a very accommodative Fed with low-interest rates, and I think we’ve got policymakers that are controlling the banks and forcing the banks to make loans,” says Sawchuk. “I don’t see the economy as having any real structural issues right now. I think this is just a normal, little pause.”

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Click here to watch the entire segment.