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Market turmoil sets the stage for a major comeback: Art Hogan

Marketable Art Hogan is looking beyond the rough start of trading week.

The chief market strategist at National Securities expects the violent movement to set the stage for a major comeback and raise the year-end target for the S & P 500.

“Here we are selling everything in risk-off mode. People are piled up on government bonds,“Hogan told CNBC”Trading country“On Monday.” Probably all of that will be stretched. “

Dow saw the worst day on Monday Covid-19 Delta Variant About risk related jitter.The· S & P 500 And the technology is heavy Nasdaq The biggest decline has been seen since May.In addition, benchmarks 10-year government bond yield It fell to 1.17%, the lowest price in five months.

“This is a radar screen blip,” Hogan said.

Hogan believes that there are 5% to 10% drawdowns.But he emphasizes it It will be a par of the course.

“We have an average of 5% drawdowns each year. Often we have 10% drawdowns each year,” Hogan said.

In such an environment, he encourages long-term investors to become equal weight growth and cyclical names. He has a strategy Return to the early days of the pandemic.

“I think if we rebalance every two months and maintain that barbell level, we’ll outperform the S & P 500,” he said. “You did it last year, and you probably will do it this year as well.”

In terms of growth, Hogan likes 5G, cloud security and cloud computing.He likes Finance, energy, industry And material The best of the cyclics.

Hogan, who oversees $ 20 billion in assets under management, acknowledges the increased risk of Covid-19. But he suspects that it could lead to extreme restrictions and a significant slowdown in economic growth.

“We have very short-term memory and very well-tuned memory muscles. [Covid] “This current wave is likely to peak and will return to what we need to focus on, such as significant profit growth,” he said.

Hogan predicts that the ongoing second-quarter earnings season will definitely exceed Wall Street’s estimates. If so, he expects to raise his S & P 500 year-end target of 4,400, up 3% from Monday’s closing price.

“There are many advantages to this market. Volatility “Remember, this is an economy that is just starting to reopen, and these are consumers who are just starting to reopen,” Hogan said.

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Market turmoil sets the stage for a major comeback: Art Hogan

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