Tags: 2020 Elections | ed yardeni | stock market | rally | surge

Ed Yardeni: Stock Market Will Surge 15% by Mid-2021

By    |   Monday, 02 November 2020 06:53 PM

Investment guru Ed Yardeni predicts that the stock market will soar almost 15 percent by the middle of next year, once the presidential election and coronavirus lockdowns are only a memory.

However, the Yardeni Research president told CNBC that he sees some volatility before next summer.

He said that frothiness in the tech sector as one of the original major catalysts.

“We’re still seeing that,” said Yardeni, also a Newsmax Finance Insider. “And then, of course, we’ve got the renewed concerns about the pandemic and when we’re finally going to get a [coronavirus] vaccine. So, it’s not as though the election is going to fix everything,” he said.

Yardeni’s base case is Tuesday’s presidential election will have a clear result within days, and it will help set the stage for a year-end rally. He speculates the S&P 500 will reach 3,500, a level that’s 2.5% below the all-time high hit Sept. 2.

By the middle of next year, Yardeni predicts the index will reach 3,800, a 15% jump from Monday's 3,310 close. He lists a post-presidential election environment, easy money policies, economic growth and coronavirus vaccine optimism as positive drivers, CNBC.com explained.

“It’s a continuation of the bull market that started way back in 2009, and it’s just been plagued with all of these panic attacks,” he said. “I have been counting them. This is number 67.”

Yardeni also notes the economic recovery should still be strong enough to support a record rally in 2021.

“It’s definitely going to slow down here, and it may be more of a Nike-swoosh [instead of V-shaped],” Yardeni said. “But I don’t see a double-dip. I don’t see a W. I think the economy will continue to do remarkably well in the face of all these challenges as long as we don’t lock everything down.”

Meanwhile, stock market participants largely expect short-term volatility and the likelihood of major long-term policy shifts related to taxes, government spending, trade and regulation. The longer-term moves will depend on whether Republican President Donald Trump or his Democratic challenger Joe Biden wins the White House race, Reuters said.

Biden leads in national opinion polls, but races are tight in battleground states that could tip the election to Trump. Analysts said the outcome most likely to shake equity markets in the near term would be no clear winner on Tuesday night.

Investors betting on a Biden administration, which is expected to deliver a massive fiscal stimulus and promote green energy, have fueled a rally in solar stocks, industrials and small-cap names in recent weeks.

On the other hand, JP Morgan has listed Bank of America , Wells Fargo and Citigroup in its "Trump basket" of stocks.

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Investment guru Ed Yardeni predicts that the stock market will soar almost 15 percent by the middle of next year, once the presidential election and coronavirus lockdowns are only a memory.
ed yardeni, stock market, rally, surge
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2020-53-02
Monday, 02 November 2020 06:53 PM
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