The stock market will soon rally to hit new heights despite the heightening tariff tensions between the United States and China, and U.S. president’s recent threats of slapping harsher trade tariffs on Mexico.
According to Wall Street bull Jeffrey Saut, the market is set to calm in the next few weeks and by mid-June, stocks will be rallying higher.
However, the next two or three weeks will be tough for investors, Saut said on while speaking to CNBC’s “Trading Nation.” These crucial weeks will be brutal.
He said that models point to the fact that there will be a lot of “chop around and flop around until mid-June,” before the turnaround begins to manifest.
Suat is the chief portfolio manager and senior investment strategist at Capital Wealth Planning. He is a veteran Wall Street analyst, with nearly half a century of experience.
The strategist acknowledges that for the most part, the market is in a very challenging phase and somewhat difficult for investors to navigate. He quipped that “emotionally,” [one] could find it easier to give in and capitulate.
At the moment, the major indexes are looking to bounce from their worst month in 2019, while the Dow, on the other hand, has declined for the sixth straight week for the first time since 2011.
But despite the gloom, Saut states that the statistics may be discouraging but it doesn’t mean that the market won’t realize any gains to the end of the year.
According to him, the market is supposed to “have enough internal energy” that can help it gather new momentum to bounce towards new all-time highs.
Saut maintains confidence that the market and other economic fundamentals remain solid despite the fears of recession arising from Trump’s threats to Mexico. The fundamentals could push the S&P 500 higher to reach 3,000 by the end of 2019, rising 9%. The strategist says selling stocks in these conditions would be a mistake. He, however, notes that it is advisable to look out for bargains and from these, put more cash back into the market.