Longtime Bull Tom Lee Issues Warning, Says 2026 May ‘Look Like a Bear Market’ – Here’s His New Forecast
Fundstrat’s Tom Lee says he’s not as bullish on 2026 as he has been in earlier years.
In a brand new interview on CNBC, Lee says 2026 may not look so sizzling, though he’s anticipating the S&P 500 to maneuver considerably larger by the top of the yr.
“Subsequent yr is a yr the place we now have a Supreme Court docket probably overturning tariffs after which a brand new Fed which can be examined. So I believe we may have what appears to be like like a bear market in 2026.”
Lee says he believes the S&P 500 will land round 7,000 on the finish of this yr and attain 7,700 by the top of subsequent yr, for a ten% achieve.
“I believe there’s a deceleration of what the market can do subsequent yr. However that 10% I believe belies what can be a really turbulent yr just like this yr the place we had tariffs and type of a Fed that grew to become hawkish once more…
We exit sturdy. I imply, even with a with a brand new Fed, it’s divided clearly, as we realized but once more yesterday, we all know from what the president needs to do by way of who he needs to nominate that the bias goes to be in the direction of easing.”
Lee says he expects tech shares to maneuver by means of a interval of consolidation in the beginning of the yr, with small caps and financials probably outperforming.
He says the substitute of Fed Chair Jerome Powell after his time period expires in Could will in the end gas markets.
“I believe tech goes to be a gaggle that in all probability has to digest the prodigious good points made this yr into early subsequent yr. And we all know that each time tech begins to stall, individuals surprise is that the management ending so the market will fall or is that this a rotation…
The true message on the finish of the yr can be there’s the Fed put again in play. So then you’ve a White Home put and a Fed put that are tailwinds for shares. However earlier than all that occurs, the Fed has to the brand new chairman must be confirmed.
It takes about 90 days from the time that his nomination takes place within the affirmation and the markets all the time take a look at a brand new Fed chair. So I believe that that’s the January to October interval is that the Fed is being examined although we all know it’s going to be a dovish Fed and a Fed put comes out of that.”
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