Tom Lee, head of research at Fundstrat, believes the stock market is experiencing a powerful rally, despite widespread skepticism. He calls it the “most hated” rally, because many investors remain convinced the market is headed for a fall.
A Powerful, Unexpected Rally
The S&P 500 has climbed 17% from recent lows, nearing an all-time high. Lee attributes this surge to a combination of factors, including a powerful but underestimated market recovery. He acknowledges the understandable bearish sentiment, citing the unexpected market downturn following tariff changes and the subsequent 20% drop in stocks.
History Repeating Itself?
Lee points to historical patterns to support his bullish outlook. He notes that similar skepticism followed market crashes in March 2020 and October 2022, yet both periods were followed by significant rallies. He believes investors tend to remain bearish until a new all-time high is reached, at which point sentiment usually shifts.
Bitcoin and the US Debt Downgrade: What Do They Mean?
Lee also cites Bitcoin’s recent surge above $111,000 as a positive indicator. He observes that Bitcoin often peaks before the S&P 500, and both assets are influenced by global liquidity.
Regarding Moody’s downgrade of US government debt, Lee downplays its significance, pointing out that similar downgrades occurred in 2011 and 2023 without causing major market disruptions.
Disclaimer:
This information is for general knowledge and shouldn’t be considered investment advice. Always do your own research before making any investment decisions.
