{"id":27640,"date":"2023-06-26T11:40:00","date_gmt":"2023-06-26T15:40:00","guid":{"rendered":"https:\/\/ifintechworld.com\/markets\/heres-what-wall-streets-most-bullish-analyst-heading-into-the-year-thinks-of-the-stock-market-now\/"},"modified":"2023-06-26T11:40:01","modified_gmt":"2023-06-26T15:40:01","slug":"heres-what-wall-streets-most-bullish-analyst-heading-into-the-year-thinks-of-the-stock-market-now","status":"publish","type":"post","link":"https:\/\/ifintechworld.com\/?p=27640","title":{"rendered":"Here\u2019s what Wall Street\u2019s most bullish analyst heading into the year thinks of the stock market now"},"content":{"rendered":"

It\u2019s back to business on Monday, but there\u2019s a bit of nervousness after the near coup\/rebellion\/cage fight<\/a> in one of the world\u2019s biggest nuclear powers over the weekend. <\/p>\n

Questions remain over a possible power struggle in Russia, as it continues to wage war on Ukraine. But barring bigger developments, investors are returning their focus on whether aggressive central banks will spark a recession and market fallout.<\/p>\n

\n

Read:<\/strong> What\u2019s next for markets after aborted Wagner mutiny leaves Russia\u2019s Putin weakened <\/p>\n

Wall Street has been growing more bullish after entering 2023 in a fearful state, following the S&P 500\u2019s
\n SPX,
\n -0.09%<\/bg-quote>
\n worst year since 2008. One analyst who led bullish views headed into 2023 was Deutsche Bank\u2019s chief U.S. equity and global strategist, Binky Chadha, who sees a 4,500 finish, and others have been playing catch up to him.<\/p>\n

In our call of the day<\/strong>, Chadha spoke to MarketWatch about why he\u2019s not budging from that bullish call and what, if anything, could derail his optimistic view. <\/p>\n

He said the year has been playing out as the bank had forecasted \u2014 strong rallies led by a squeeze on markets due to underweight positioning, with tech in the driver\u2019s seat \u2014 the Nasdaq
\n COMP,
\n -0.22%<\/bg-quote>
\n is up 16% so far this year. The path higher will be more of a grind as some of that positioning has caught up, he says. <\/p>\n

<\/p>\n
<\/p>\n<\/figure><\/div>\n

Read: <\/strong>Why the \u2018easy money\u2019 has been made in the stock-market rally \u2014 and what comes next<\/p>\n

Chadha said he\u2019d rethink his more bullish outlook on \u201csigns of corporate risk aversion. Companies pulling back and going back into the bunker.\u201d That is corporates becoming risk averse, cutting working capital, hoarding cash, and paring capital expenditure, he said. For now, he doesn\u2019t see that. <\/p>\n

The strategist also weighed in on narrow market leadership, where S&P 500 gains are led by just a handful of names. \u201cKeep in mind that the selloff of last year was also narrow,\u201d he said, when energy stocks soared on higher prices.<\/p>\n

But this year the reversal has seen techs rally and now he sees indeed the gains spreading to more names. He said the bank recently removed its overweight on mega-tech stocks because earnings are rebounding, but markets have priced in a lot more than they expect.<\/p>\n

As for where to put money now? \u201cI wouldn\u2019t be long financials here. The events of March have painted financials with a very broad brush. Most of the large -cap financials are really beneficiaries of what happened in March, but the market has put a risk premium on them,\u201d said Chadha<\/p>\n

As for cyclical consumer stocks, the risk\/reward is asymmetrical because so much is priced in for the downside. \u201cEverybody in the market has been waiting so long for the recession and some things are priced for even more than an average recession,\u201d he said.<\/p>\n

\u201cAnd so I think you want to be long the cyclical parts of the consumer, and I think you want to be underweight defensives, because rates stay here and that\u2019s where everybody has been hiding,\u201d he said.<\/p>\n

And what would make Chadha lift that 4,500 S&P 500 target? \u201cBetter prospects for the economy, better prospects for growth. In the event of a soft landing, and to be clear that is not our house view, but that would not be a terrible thing.\u201d And that would eventually lead to upside for markets, he said.<\/p>\n

The markets<\/h2>\n
<\/p>\n
<\/p>\n<\/figure><\/div>\n

Stocks
\n SPX,
\n -0.09%<\/bg-quote><\/p>\n

DJIA,
\n -0.11%<\/bg-quote><\/p>\n

COMP,
\n -0.22%<\/bg-quote>
\n are marginally lower, but Treasury yields
\n TMUBMUSD10Y,
\n 3.715%<\/bg-quote>
\n have steadied, along with oil prices
\n CL.1,
\n +0.19%<\/bg-quote>,<\/span>
\n while silver
\n SI00,
\n +2.38%<\/bg-quote>
\n is making strides. Lots of weakness across Asia, led by the Shanghai Composite
\n SHCOMP,
\n -1.48%<\/bg-quote>,<\/span>
\n while Europe stocks
\n SXXP,
\n -0.08%<\/bg-quote>
\n are lower after a newsy Russia weekend, and natural-gas futures
\n NG00,
\n +0.95%<\/bg-quote>
\n are higher both in the U.S. and Europe. The ruble
\n USDRUB,
\n +0.91%<\/bg-quote>
\n is down 0.9% against the dollar
\n DXY,
\n -0.20%<\/bg-quote>,<\/span>
\n which is a little softer overall. <\/p>\n

For more market updates plus actionable trade ideas for stocks, options and crypto,\u00a0subscribe to\u00a0MarketDiem by Investor\u2019s Business Daily.<\/strong><\/p>\n

The buzz<\/h2>\n

Goldman Sachs became the third Wall Street bank in a week to downgrade Tesla shares
\n TSLA,
\n -2.37%<\/bg-quote>
\n to neutral, saying the stock has had a strong run-up and competition grows for the EV maker. The stock is down 2%.<\/p>\n

PacWest shares
\n PACW,
\n +6.40%<\/bg-quote>
\n are up 8% after the regional bank said it sold its loan portfolio to Ares Management
\n ARES,
\n +2.44%<\/bg-quote>
\n in deal that will generates $2 billion \u2018to improve liquidity.\u2019<\/p>\n

Lucid
\n LCID,
\n +9.41%<\/bg-quote>
\n stock is up 7% after the EV and battery pack maker agreed a deal to provide Aston Martin with powertrain and battery system technology for luxury EVs.<\/p>\n

Virgin Galactic stock
\n SPCE,
\n -3.11%<\/bg-quote>
\n climbed 6.7% after the private spaceflight company said June 29 is the target date for its first commercial flight.<\/p>\n

IBM
\n IBM,
\n +0.96%<\/bg-quote>
\n has confirmed a $4.6 billion all-cash deal for privately held software group Appio. IBM shares are down slightly.<\/p>\n

The Fed\u2019s preferred inflation gauge \u2014 the personal-consumption expenditures price index \u2014 is a big economic highlight, due Friday. Durable goods and some housing market data is coming Tuesday, with appearances by Fed Chairman Jerome Powell on Wednesday and Thursday. <\/p>\n

German business sentiment fell in June as the country\u2019s manufacturing outlook worsened.<\/p>\n

Russia\u2019s defense minister Sergei Shoigu was spotted visiting troops in Ukraine on Monday \u2014 his first public appearance since the weekend rebellion pushing for his ouster. Not heard from \u2014 President Vladimir Putin or Belarus-bound Wagner chief Yevgeny Prigozhin.<\/p>\n

Best of the web<\/h2>\n

We asked a language model to write career advice based on caterer-turned-coup leader Yevgeny Prigozhin. Here\u2019s what it generated.<\/p>\n

Second-quarter corporate profits are set for their biggest drop since the start of the pandemic. But then the worst could be over.<\/p>\n

Here\u2019s to not traveling, which turns us into the worst version of ourselves as it convinces us we\u2019re at our best.<\/p>\n

Octopus farming \u2014 a symbol of what humans should not be doing<\/p>\n

The chart<\/h2>\n

\u201cIf this is still a bear market rally it will end up being the longest bear market rally in history (which probably means it isn\u2019t a bear market rally!),\u201d says the Weekly S&P 500 Chartstorm blog by Callum Thomas, head of research and founder @topdowncharts<\/a>, referring to the below chart:<\/p>\n

<\/p>\n
<\/p>\n<\/figure><\/div>\n

Top tickers<\/h2>\n

These were the top-searched tickers on MarketWatch as of 6 a.m.:<\/p>\n\n\n\n\n\n\n\n\n\n\n\n\n
\n Ticker<\/p>\n<\/td>\n\n Security name<\/p>\n<\/td>\n<\/tr>\n
\n TSLA,
\n -2.37%<\/bg-quote>\n <\/td>\n		\n Tesla<\/p>\n<\/td>\n<\/tr>\n
\n GME,
\n -0.08%<\/bg-quote>\n <\/td>\n		\n GameStop<\/p>\n<\/td>\n<\/tr>\n
\n AMC,
\n +1.12%<\/bg-quote>\n <\/td>\n		\n AMC Entertainment<\/p>\n<\/td>\n<\/tr>\n
\n NVDA,
\n -2.11%<\/bg-quote>\n <\/td>\n		\n Nvidia<\/p>\n<\/td>\n<\/tr>\n
\n LCID,
\n +9.41%<\/bg-quote>\n <\/td>\n		\n Lucid<\/p>\n<\/td>\n<\/tr>\n
\n NIO,
\n +1.75%<\/bg-quote>\n <\/td>\n		\n Nio<\/p>\n<\/td>\n<\/tr>\n
\n AAPL,
\n +0.12%<\/bg-quote>\n <\/td>\n		\n Apple<\/p>\n<\/td>\n<\/tr>\n
\n SPCE,
\n -3.11%<\/bg-quote>\n <\/td>\n		\n Virgin Galactic<\/p>\n<\/td>\n<\/tr>\n
\n MULN,
\n -0.59%<\/bg-quote>\n <\/td>\n		\n Mullen Automotive<\/p>\n<\/td>\n<\/tr>\n
\n AMZN,
\n +0.36%<\/bg-quote>\n <\/td>\n		\n Amazon.com<\/p>\n<\/td>\n<\/tr>\n<\/table>\n

Random reads<\/h2>\n

Man bought lifetime United Airlines pass three decades ago, has \u201clived like a sultan\u201d ever since.<\/p>\n

Kylie Minogue\u2019s \u201cPadam Padam\u2019 single is fast-tracking its way to gay classic status.<\/p>\n

Naples tells billionaires to park their superyachts somewhere else.<\/p>\n

Need to Know starts early and is updated until the opening bell, but\u00a0sign up here\u00a0to get it delivered once to your email box. The emailed version will be sent out at about 7:30 a.m. Eastern.<\/strong><\/p>\n

Listen to the\u00a0Best New Ideas in Money podcast\u00a0with MarketWatch reporter Charles Passy and economist Stephanie Kelton.<\/strong><\/p>\n<\/p><\/div>\n