US Stock Market Looks More Favorable Now Than Pre-Trade War, According to Fundstrat’s Tom Lee – Here’s Why
Fundstrat’s head of analysis Tom Lee believes that US equities are in a a lot better place now in comparison with the interval earlier than Trump ignited a commerce conflict.
In a brand new interview on CNBC Tv, Lee says heightened optimism for 2026 and US corporations thriving throughout laborious occasions are indicators suggesting the inventory market seems extra favorable than it did earlier than Donald Trump sparked a commerce conflict with quite a few nations.
“After we return to February when the market was at all-time highs, we have now to bear in mind, we had plenty of uncertainties forward of us and we weren’t essentially 2026.
The tariff visibility is a lot better as we speak than it was three months in the past, and after we have a look at 2026, I believe there are issues to look ahead to, similar to deregulation, tax cuts, and a [Federal Reserve] that’s on maintain now however in all probability doing extra cuts in 2026.
From an organization perspective, corporations survived, I believe, a black swan occasion. That waterfall of decline in equities and the close to coronary heart assault of the financial system was an setting the place corporations produced earnings that beat expectations. I imply, that is the fifth stress take a look at for companies [and] once I put all that collectively, I believe PE (price-to-earnings ratio) might be going to be larger in six months than decrease, and when you concentrate on 2026 earnings having upside, I believe there’s upside for shares.”
Lee goes on to say that investor sentiment shifting to impartial or constructive may assist shares through the second half of the yr. He additionally notes that institutional gamers are underexposed on the inventory market.
“We all know plenty of establishments didn’t add danger again because the market rallied.
So I believe the pullbacks are going to be fairly shallow as a result of buyers simply are underinvested in the meanwhile. After which while you have a look at sentiment, it’s barely turning impartial now, so if buyers have been preventing this rally, as they develop into extra optimistic or impartial, that’s upside for shares.”
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