Research manager at FundStrat Tom Lee, argued that the US stock market likely has more room to move upside. This means that the stock market is not a “bubble” unless consensus is formed.
Unless there is consensus and the risk has not yet disappeared, it seems difficult to deny the existence of a bubble. In this case, we’re probably in a bubble. However, many people raise the possibility that this is a potential bubble, which is an early warning.
NEWS CONTINUES BELOW
According to Lee, Federal Reserve‘s failure to lower interest rates could pose a threat to the strength of the stock market. However, Lee states that the possibility of a rate cut by March is higher than expected.
“If the Federal Reserve doesn’t cut interest rates, I think it could be quite risky for the stock market. I don’t think the Fed will hesitate just because stock market values are rising…
The policy rate of around 5.5% is one of the highest interest rates among developed countries around the world… The state of the bond market shows that the Fed is currently quite restrictive…
I think the likelihood of a rate cut in March is higher than what is currently priced in, and this will largely depend on the February CPI, which will be released on March 12. However, we believe there are some anomalies in the January CPI, which includes weak seasonal adjustments…
“If these situations improve, I think repricing will reverse to a large extent, despite the high CPI figures we observed in January.”
