U.S. stocks surged, but one of Wall Street's most optimistic bulls hesitated
One of the most optimistic bulls on Wall Street, Tom Lee, recently stated that the Fed's rate cut cycle has laid the foundation for a real strengthening of the US stock market in the next one or three months. However, with the approaching of the November US presidential election, there is still great uncertainty about the future trend of the US stock market and not everyone believes that it will continue to rise
On Thursday, following a significant interest rate cut by the Federal Reserve, the first-time jobless claims in the United States came in lower than expected, boosting expectations of a soft landing for the U.S. economy. As a result, the Dow Jones Industrial Average (DJIA) broke through 42,000 points for the first time, the S&P 500 Index closed above 5,700 points for the first time, and the Nasdaq rose by as much as 3% intraday.
However, amidst this strong upward momentum, one of the most optimistic bulls on Wall Street, Tom Lee, the research director of Fundstrat Global Advisors, hesitated. He recently stated:
The Fed's rate cut cycle has laid the foundation for a real strengthening of the U.S. stock market in the next month or three months.
However, with the approaching November U.S. presidential election, I am not entirely convinced that the U.S. stock market will continue to rise. I believe that from now until Election Day, there is still a great deal of uncertainty in the trajectory of the U.S. stock market. That's why I feel somewhat hesitant about whether investors should enter the market.
With less than 100 days until the U.S. presidential election, there is uncertainty surrounding the economic policies of each candidate, causing some investors to hesitate to make significant bets on certain stocks and industries before the final results are known.
Tom Lee's bullish view on the U.S. stock market for 2024 is correct, and he has made several bold short-term predictions in the market. During the COVID-19 pandemic, he was also one of the first on Wall Street to be bullish on the stock market. Earlier this month, he pointed out that the U.S. stock market may experience a 7%-10% pullback.
Tom Lee believes that small-cap stocks and cyclical stocks, such as industrials and financials, will benefit from lower interest rates. An economic boost in the U.S. can lead to increased trading activity and may also drive up these types of stocks