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The rally looks set to continue

A top Oppenheimer strategist tells CNBC that Wall Street’s recent rally looks set to continue as investors are less skeptical about the negative outlook for the US economy. He believes investors have become more confident and points out that the S&P 500 is up 12% since Oct. 12.

“You have some value, you have a little bit more growth, as well as cyclical and defensive investment opportunities. Investors seem to be coming back. So we think the recent recovery will likely hold up,” the investment strategist said.

The stock market rally was a result of the Federal Reserve signaling that it will soon ease the pace of interest rate hikes and that inflation data appears to be improving. The rally shows that fears of a recession could ease, the Oppenheimer strategist said.

Think that the recession has a price

“We think the stock market has already priced in a recession quite large,” Stoltzfus said.

The strategist added that it’s “very likely” the stocks are heading back into a bull market after plunging heavily earlier this year. He stressed that consumer goods and technology are sectors that can recover after a difficult 2022.

Oppenheimer has an S&P 500 target of 4,000 points. The index trades around that level and Stoltzfus said on Friday the index was likely to finish 2022 above his target.

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