• Hedge fund veteran Tom Lee remains bullish on the stock market despite its corrective moves to start the month of August.
• According to Lee, a few macro factors are starting to look favorable for the stock market including a reversal in the dollar and yields.
• Lee also notes that institutional investors are quick to flip bearish on the stock market following the recent correction, suggesting that there is still $5.5 trillion of cash waiting to be pulled into the stock market.
Fundstrat’s Tom Lee Bullish on Stock Market
Hedge fund veteran Tom Lee from Fundstrat Global Advisors remains bullish on the stock market despite its corrective moves this month of August. In a new CNBC interview, he states that his company believes equities are likely in process of carving a bottom for this month due to several macro factors such as dollar reversal and lower yields which could be headwinds for stocks but may turn out positive if CPI (Consumer Price Index) report comes out favorable this week.
Institutional Investors Quick To Flip Bearish
Lee observes that institutional investors have been quick to flip bearish on stocks given their dip since four days ago. He believes this may not be an indication of ebullient market but rather people getting pulled in with still $5,500 billion dollars waiting to get pulled into stocks.
Positive Macro Factors For Stock Market
Lee identifies some positive macro factors which could work in favor of equity markets such as dollar reversal and reduced yields which can potentially signal Fed’s decision not to raise interest rates further, as well as decent jobs number reported recently with CPIs looking good this week too.
Potential Impact Of Cash Pulled Into Stocks
The potential impact of pulling billions into stocks from sidelines cannot be understated as it might inject liquidity and boost stock prices up further. This would mean more investment opportunities for investors who believe in long term growth potential of equities.
Overall, Fundstrat’s Tom Lee is optimistic about stocks carving a bottom soon with plenty of cash waiting to be pulled into markets should conditions remain favorable allowing gains for equity markets going forward despite current dips being experienced by traders recently .