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“We are the most bullish on the market for about a year.”
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This is Meghan Shue, head of investment strategy at Wilmington Trust, who explains to CNBC why she is optimistic that the stock market will have some rise over the next nine to twelve months.
He said a combination of the vaccine, fiscal stimulus and increased Federal Reserve support led Wilmington, which had some $ 124 billion in overseas assets, to add to its position with overweight in equities, specifically in emerging markets and small-cap stocks.
“U.S. large-cap stocks, technology stocks, have a lot of really aggressive growth targets, valued at valuations right now,” Shue said. “We see that stocks in emerging markets and small U.S. capitalization have an additional rise where many of these initial economic cycle profits are not fully priced.”
Of course, there is the potential for everything to go wrong.
“This is a difficult time right now when it comes to the virus,” Shue continued. “The main risk is that it will persist for longer than many people expect, until well into the first quarter, where we have companies closed for an extended period of time.”
Also, a turnaround in Senate runoff could be problematic for actions.
“If we had, the Democrats would bother us and win both seats [in Georgia]”I think we need to weigh the risk of raising taxes in the future and a more global policy change that relates to regulation, energy or health care,” he said.
Then there is the issue of two investors sharing the same perspective.
“It looks like we’re all on the same side of the boat, waiting for the same things to come out, so there’s a potential for annoyance,” he said. “But we would encourage our clients to examine any short-term volatility, as at the end of the day it is a normal part of the investment.”
Watch the interview:
The weeks seem to start with a step up, with futures on the Dow Jones Industrial Average YM00,
Nasdaq Composite NQ00,
and S&P 500 ES00,
all green on Sunday night.