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“We’re the most optimistic in the market we’ve been in about a year.”
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That’s Meghan Shue, head of investment strategy at Wilmington Trust, explaining to CNBC why she’s optimistic that the stock market will have some upward momentum in the next nine to 12 months.
She said a combination of the vaccine, fiscal stimulus and further Federal Reserve support led Wilmington, which owns approximately $ 124 billion in assets overseas, to strengthen its overweight position in equities, particularly in emerging and small markets. cap stocks.
“US large-cap stocks, technology stocks, have a lot of really aggressive growth targets priced into valuations right now,” Shue said. “We see that emerging market and US small-cap stocks have additional upside potential, while many of those… benefits of the early economic cycle have not been fully priced in.”
Of course it can all go aside.
“This is a challenging time for the virus right now,” Shue continued. “A big risk is that this will last longer than many people expect, well into the first quarter, where we have businesses closing for longer periods of time.”
Also, a turn in Senate layoffs could be problematic for stocks.
‘If we had let the Democrats take care of a prank and win both seats [in Georgia]”I think you have to weigh the risk of higher taxes in the future and more significant regulatory, energy or healthcare policy changes,” she said.
Then there is the matter of two many investors sharing the same outlook.
“We all seem to be on the same side of the boat, expecting the same things to turn out, so there’s a chance of upset,” she said. “But we would encourage our clients to look through any short-term volatility, which is ultimately a normal part of investing.”
Watch the interview:
The weeks appear to be off to an upward move, with futures on the Dow Jones Industrial Average YM00,
Nasdaq Composite NQ00,
and S&P 500 ES00,
all in green late on Sunday evening.