Tags: yardeni | bull | market | small caps | stocks | investors

Yardeni: Bull Market Will Grow, Small Caps Set to Roar

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By    |   Monday, 04 June 2018 09:19 AM

Investment guru Edward Yardeni advises savvy investors to tune out any geopolitical noise because he thinks the raging bull stock market will only continue to climb higher under President Donald Trump.

Leading the continuing market surge will be small-cap stocks, he predicts.

"I've never seen a president that has been this bullish and bearish at the same time," the Yardeni Research President recently told CNBC.

The Newsmax Finance Insider explained that while the Trump tax cuts have made the U.S. economy stronger, protectionist policies have stoked market anxiety.

"A lot of what's going on is noise," he said. "There is still money to be made in this market," he said.

Yardeni predicts the S&P 500 will end the year at 3,100, a surge of about 13 percent from current levels of about 2742.

"Earnings are just fabulous. I mean we had a dramatic cut in the corporate tax rate at the end of last year," the former New York Federal Reserve economist said. "We should really focus on the signal. And, the strong signal is earnings," he said.

And he tells investors to keep a sharp eye on stocks of small market capitalization companies, commonly referred to as small caps.

"Small cap stocks are on fire, at record highs, because they are not as exposed to the global economy in currency and protectionism," Yardeni said.

Yardeni isn't alone in his economic optimism.

Friday’s blockbuster jobs data capped a long line of recent strong economic reports which has led to much brighter forecasts for American growth under Trump.

The Atlanta Fed on Friday said it expects U.S. gross domestic product (GDP) to expand at a 4.8 percent pace in the second quarter, up from 4.7 percent on May 31. Friday's revision was just the latest in a recent handful of surging revisions. On May 25, the measure predicted four percent GDP growth.

Meanwhile, the New York Fed’s Nowcast also rose Friday, to 3.5 percent from 3.0 percent a week ago.

The improved forecasts come even as the stimulus from a $1.5 trillion income tax cut package and increased government spending is yet to be fully felt.

Trump himself has taken to Twitter to tout his economic accomplishments.

"This is my 500th. Day in Office and we have accomplished a lot - many believe more than any President in his first 500 days. Massive Tax & Regulation Cuts, Military & Vets, Lower Crime & Illegal Immigration, Stronger Borders, Judgeships, Best Economy & Jobs EVER, and much more..." he tweeted Monday.

Trump's chief economic adviser says Friday’s blockbuster unemployment report is a sign of the robust economic growth awaiting America.

“I believe we've entered into the longest largest prosperity in a couple of decades. I know it's early in the game,” Larry Kudlow, director of the White House's National Economic Council, told CNBC.

(Newsmax wire services contributed to this report).

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Investment guru Edward Yardeni advises savvy investors to tune out any geopolitical noise because he thinks the raging bull stock market will only continue to climb higher under President Donald Trump.
yardeni, bull, market, small caps, stocks, investors
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2018-19-04
Monday, 04 June 2018 09:19 AM
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