Latest news with #Fundstrat
CNBC
a day ago
- Business
- CNBC
Deutsche Bank raises S&P 500 forecast on 'TACO' theory: 'We will get further relents'
Deutsche Bank's Binky Chadha is bullish again, confident that the Trump administration will continue to back down on tariffs. "Our base case was for a significant rally in equities on a credible relent on trade policies," the chief U.S. equity and global strategist wrote on Tuesday. "In the event, the administration relented earlier than we had anticipated, driven primarily by market reaction, and before the emergence of any legal barriers or economic or political pain." "This reinforces the view that if negative impacts of tariffs do materialize, we will get further relents," Chadha added. Chadha raised his year-end S & P 500 forecast by 6.5%, to 6,550 from 6,150, implying roughly 10% upside from Monday's close. The strategist was one of the biggest bulls on Wall Street coming into 2025, with an original price target of 7,000, but cut his target in April after the severity of President Donald Trump's initial tariff announcement shocked Wall Street. Fundstrat's Tom Lee is currently the biggest bull on the Street, with a 6,600 price target, according to the CNBC market strategist survey . Now the strategist expects that the fundamental corporate earnings strength underpinning his original thesis will hold, betting that the so-called "TACO trade" will curb any market or economic fallout. The "TACO trade," or "Trump Always Chickens Out," refers to an idea coined by a Financial Times columnist that investors can count on the president to back down from tariffs. The phrase has gained in popularity on Wall Street. CNBC's Megan Cassella asked Trump directly about it in the Oval Office last week. .SPX 3M mountain S & P 500 over the past three months "We remind that prior to the outsized tariff escalation, the cycle showed plenty of legs with various aspects just beginning to kick in to the upside," Chadha wrote. "We see plenty of room for equity positioning to rise with discretionary investors at neutral and systematic strategies still underweight and expect buybacks will remain solid with no signs of companies going into the bunker." Stocks have staged an impressive comeback rally over the past two months. The S & P 500 since is coming off its best monthly performance since November 2023 as investors grow increasingly confident that the president was mainly threatening high tariffs as a negotiating tool. The broad market index gained more than 6% in May, in large part after Trump reached a preliminary trade agreement with China, though he has since claimed it's not being honored. Later in May, a federal court struck down Trump's tariffs , adding to confidence the worst of the tariffs are behind investors, though they were then reinstated temporarily by an appeals court.
CNBC
a day ago
- Business
- CNBC
Look for some consolidation before stocks retest all-time highs, chart analysts say
Fresh all-time highs for the stock market could be in the cards after May's strong performance. They won't come immediately, however. The S & P 500 surged 6.2% last month, marking its biggest monthly advance since November 2023. The Nasdaq Composite also roared nearly 10% higher in that time. The advances left the S & P 500 and Nasdaq 3.4% and 6.1% below records set in February and December, respectively. The tough part for investors now will be to remain patient, as chart analysts think the major averages need to absorb the sharp May gains before moving record levels. "While a rally over February peaks should happen this Summer, it's hard to make a technical call for an immediate breakout," Fundstrat technical strategist Mark Newton wrote. "Both SPX and QQQ likely will find resistance near February highs that allows for consolidation in mid-June ahead of a push back to new all-time highs." "Any near-term breakout above May highs should carry SPX up to between 6025-6150 while QQQ might approach 540. Thereafter, it's important to watch carefully for any possibility of trend reversal, which could start as early as next Monday," Newton added. The S & P 500 peaked at 5,968.61 in May, while the Invesco QQQ Trust — which tracks the Nasdaq-100 index — reached $526.48. The former ended Monday's session at 5,935.94, while the latter closed at $523.21. .SPX bar 2025-02-18 SPX since Feb. 18 The broad market benchmark reached an all-time high of 6,147.43 on Feb. 19. At one point in April, it was roughly 20% below that mark before staging a rebound. Craig Johnson, chief market technician at Piper Sandler, noted that the S & P 500 is "setting the stage for the next upward move over the proverbial 'wall of worry.'" "The SPX and most sectors are just consolidating near their May highs, setting up for potential breakouts," he added. "While stocks are somewhat stretched in the short term, we remain optimistic and view modest dips and pullbacks, particularly back to well-established support levels, as buying opportunities."
Mint
3 days ago
- Business
- Mint
Gold's rally broke down in May. It's still doing better than stocks.
Gold futures fell 0.5% to $3,288.90 per troy ounce in May to snap a four-month winning streak, with the metal marking its biggest monthly decline in five months, according to Dow Jones Market Data. Gold is still up 25.1% this year, far outpacing the S&P 500's 0.5% 2025 gain. The price of gold's retreat has coincided with a broader stock market rally. Investors bought gold in April as worries about the U.S. spiked amid President Donald Trump's trade war, so some market participants took profits as tensions faded. It's no coincidence that gold hit a record of $3,411.40 per troy ounce on May 6 before retreating: that's right when the White House said Treasury Secretary Scott Bessent would meet with China to discuss trade. Talks between the U.S. and China took place on May 10 in Switzerland. Gold pulled back while stocks rallied the following week, as traders reacted to news the U.S. would lower tariffs on China to 30% while both sides hammered out a deal. Fundstrat's head of technical strategy Mark Newton argues that precious metals like gold look to be near the end of their recent consolidation, meaning they could push back to fresh records in the months ahead. 'Safe-Haven trades like Japanese Yen and Gold should be starting to turn back higher, and I expect that Equities can still rally despite this happening into mid-June," Newton wrote in a Friday note. 'I favor Industrials, Financials, Technology and Utilities, while Emerging markets also have appeal given the drop in the US Dollar." Of course, the next move for gold may have more to do with the Trump administration's trade talks with China. Tensions have been higher in recent days, with Bessent saying on Thursday that talks had 'stalled." Trump on Friday said China has 'totally violated its agreement with us." U.S. Trade Representative Jamieson Greer later that day told CNBC that China failed to restore exports of some rare-earth magnets used for electric motors. 'Recently, China has repeatedly raised concerns with the US regarding its abuse of export control measures in the semiconductor sector and other related practices," Liu Pengyu, a Chinese embassy spokesperson, said in a statement on Friday. 'China once again urges the US to immediately correct its erroneous actions, cease discriminatory restrictions against China and jointly uphold the consensus reached at the high-level talks in Geneva." The market isn't taking the latest back and forth too seriously: Stocks barely moved on Friday. And gold? It fell 0.9%. Write to Connor Smith at
CNBC
27-05-2025
- Business
- CNBC
Budget deficit is real threat long-term, says Ariel's Charlie Bobrinskoy
Charlie Bobrinskoy, Ariel Investments vice chairman, and Tom Lee, Fundstrat head of research, joins 'Closing Bell Overtime' to talk the day's market action.
Globe and Mail
26-05-2025
- Business
- Globe and Mail
1 Brilliant Vanguard Index Fund to Buy Before It Soars Nearly 160%, According to a Wall Street Analyst
The S&P 500 (SNPINDEX: ^GSPC) is considered the single best gauge for the overall U.S. stock market. The index is down about 1% year to date, and Wall Street analysts expect little change in the remaining months of 2025. However, Tom Lee at Fundstrat Global Advisors predicts the S&P 500 will reach 15,000 by 2030. That implies 158% upside from its current level of 5,800. Investors can position their portfolios to capture those potential gains by owning shares of the Vanguard S&P 500 ETF (NYSEMKT: VOO). Read on to learn more. Image source: Getty Images. The Vanguard S&P 500 ETF provides exposure to hundreds of influential stocks The Vanguard S&P 500 ETF tracks the performance of 500 large U.S. companies. It includes stocks from every market sector, but is most heavily weighted toward technology. The index fund covers about 80% of domestic equities and 50% of global equities by market value, providing exposure to many of the most influential stocks in the world. These are the top 10 positions in the Vanguard S&P 500 ETF listed by weight: Apple: 6.7% Microsoft: 6.2% Nvidia: 5.6% Amazon: 3.6% Alphabet: 3.5% Meta Platforms: 2.5% Berkshire Hathaway: 2.1% Broadcom: 1.9% Tesla: 1.6% Eli Lilly: 1.5% The S&P 500 advanced 173% in the last decade, compounding at 10.5% annually. If dividends are included, the index achieved a total return of 226% over the same period, increasing at 12.5% annually. At that pace, $500 invested monthly during the last 10 years would now be worth more than $105,000. Importantly, while the U.S. economy suffered three recessions over the last 30 years, the S&P 500 generated a positive return over every rolling 11-year period during that time. Put differently, any investor that bought an S&P 500 index fund in the last three decades made a profit so long as they held the fund for at least 11 years. Why Fundstrat analyst Tom Lee thinks the S&P 500 is headed to 15,000 by 2030 Tom Lee is the head of research at Fundstrat Global Advisors. He manages the Fundstrat Granny Shots U.S. Large Cap ETF, an exchange-traded fund that holds about three dozen U.S. stocks worth at least $10 billion. Lee selects stocks by identifying market themes and applying quantitative models to companies that meet the inclusion criteria. The Granny Shots ETF has beat the S&P 500 by 4 percentage points since its inception. Lee during an interview with Bloomberg last year made his case for why the S&P 500 could hit 15,000 by the end of the decade. First, millennials are the largest living generation and they are reshaping the economy as the enter their peak earnings years. In addition, they are set to inherit a whopping $80 trillion, the largest generational wealth transfer in history. Second, the global labor shortage is estimated to be 80 million workers by 2030. That should create demand for artificial intelligence (AI) as a means of boosting productivity and automating workflows. Consequently, Lee anticipates a parabolic move in the technology sector, which currently accounts for 30% of the S&P 500. "Between 1948 and 1967 there was a global labor shortage and technology stocks went parabolic," Lee says. "And between 1991 and 1999 there was global labor shortage and technology stocks went parabolic. So this is what's happening today." Here is the bottom line: Whether Lee is correct or not in predicting the S&P 500 will reach 15,000 by 2030, the index has consistently created wealth over long holding periods. That makes an S&P 500 index fund a smart choice for patient investors. And the Vanguard S&P 500 ETF is a particularly brilliant option because it has a cheap expense ratio of 0.03%. The average expense ratio on similar funds from other issuers is 0.75%, according to Vanguard. Should you invest $1,000 in Vanguard S&P 500 ETF right now? Before you buy stock in Vanguard S&P 500 ETF, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Vanguard S&P 500 ETF wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $639,271!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $804,688!* Now, it's worth noting Stock Advisor 's total average return is957% — a market-crushing outperformance compared to167%for the S&P 500. Don't miss out on the latest top 10 list, available when you join Stock Advisor. *Stock Advisor returns as of May 19, 2025 John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool's board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Trevor Jennewine has positions in Amazon, Nvidia, Tesla, and Vanguard S&P 500 ETF. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Berkshire Hathaway, Meta Platforms, Microsoft, Nvidia, Tesla, and Vanguard S&P 500 ETF. The Motley Fool recommends Broadcom and recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.
