Stock-market expert sees a ‘monstrous’ rally taking hold next week, if one recent trend holds

johnN

https://www.google.com/amp/s/www.marketwatch.com/amp/story/stock-market-experts-sees-a-monstrous-rally-rally-taking-hold-next-week-if-one-recent-trend-holds-11596827276

/Stock-market expert sees a ‘monstrous’ rally taking hold next week, if one recent trend holds
Last Updated: Aug. 7, 2020 at 6:55 p.m. ET


Could epicenter stocks surge by 30% next week? Fundstrat's Tom Lee thinks so. Getty Images

The best start to an August for the U.S. stock market in years might get even better, as soon as next week, if the forecast from Thomas Lee, founder of Fundstrat Global Advisors, is accurate./



Not sure if monstrous rally is coming, but DJI gained >36%% since the March crash.

We have been buying qqq and vht/couple bio tech and Healthcare etf recently. Glad did not pull out to all cash few months back. Couple friends at work did this and missed the slow upward late spring summer rally

If covid19 data improves/ stabilized next few weeks/month with minimal deaths economy may recover sooner than later

WABAC

If the economy is so healthy why is the Fed pumping trillions of dollars into it?

Sven

The market is dying for more stimulus packages. Without the Fed's QEs and large asset buying, the US market situation would have been very different than today.

Perhaps the more pertinent question should be - does the demand for goods and services accurately reflect the stock market?

johnN

Think world market may have crash if their govt did not pump more cash into systems [EU /Canadian China/ Japan/ etc past 4 months]...everything inflated...wonder if there is a bubble indeed waiting to burst

Old_Joe

What, exactly, is a "stock market expert"?

Rbrt

Could surge 30%!? Seems unrealistic to me. As a counterweight I offer the editorial by Ian Bremmer from Time magazine: The Next Global Depression Is Coming and Optimism Won’t Slow It Down

“This liquidity support (along with optimism about a vaccine) has boosted financial markets and may well continue to elevate stocks. But this financial bridge isn’t big enough to span the gap from past to future economic vitality because COVID-19 has created a crisis for the real economy. Both supply and demand have sustained sudden and deep damage. And it will become progressively harder politically to impose second and third lockdowns.”

hank

I suppose right in-line with monstrous Covid-19 numbers, monstrous investor euphoria, and monstrous national debt?

Old_Joe

This is going to be the most amazingly monstrously fantastically incredible rally in the history of the world.

Sven

Perhaps an insightful article from Barrons would be more informative. Joyce Chang is the Chair of Global Research at JP Morgan. Her comments on the impact of COVID pandemic are well articulated. Also some suggestion on investment opportunities at the end of the article.

Question: You’re not predicting outstanding returns from equities either.

Answer: No, but you will have some returns. The traditional 60/40 equity/bond split, which earned 10% a year over the past 40 to 50 years, is now down to 3½%. Even if you’re tilted to equities, you’re still not going to get 10% again. You’re going to get something below 5%, but investors really have to contemplate what their overall asset-allocation parameters will be. In a world of zero yields, Is 80/20 the way to go? Asset classes that are a hybrid between “safe” bonds and equities—such as high-yield bonds and loans, collateralized loan obligations, commercial mortgage-backed securities, convertibles, and equity and mortgage REITs—offer equity-like returns. There’s a case for emerging market debt, because I think yields will have to come down further in emerging markets as well. China is going into [J.P. Morgan’s global bond] index this year, and our longer-term view is that China is going toward zero yield.

How the pandemic will change financial markets forever

davidrmoran

the reinharts tend to the bearish, to a fault, but this argues for the long haul:

https://www.washingtonpost.com/opinions/lets-call-it-what-it-is-were-in-a-pandemic-depression/2020/08/09/3904faf4-d8e5-11ea-aff6-220dd3a14741_story.html

Derf

"Morgan Stanley forecasts a 2.8% average annual return over the next 10 years for a 60/40 portfolio. The average has been nearly 8.0% since 1881 and about 6% over the last 20 years ."
Derf