Major indices may start the month in rally mode, but PNC Financial Amanda Agati is internally aware of the issue.
She believes that the rotation from a stay-at-home order to an economically sensitive market group is overkill.
The company’s managing director and chief investment strategist told CNBC:Trading country” on Monday.
Agati discovered in November that the transition to value equities first gained momentum. PfizerVaccine.
“We have seen this massive emotional change,” Agati said. “But in the end, we didn’t really see any significant improvement in the underlying fundamentals.”
In the US stock market, she wants to be the winner in 2020. It is a growing stock of a stay-at-home order including Big Tech.
“They continue to produce truly impressive results in terms of revenue growth, and from the perspective of general profitability and underlying fundamentals,” she added. “We’ve seen valuations rise significantly there, but from our point of view, I think the long-term view is that we’ll stay very much in a world where growth and yields are scarce. So what wins in that environment? Many of the components of home trading. “
Aside from strong market performance on MondayInflation jitter has put pressure on growth play over the past few weeks.The group is particularly vulnerable to rising Treasury yield Because they affect the evaluation.
But Agati believes inflation concerns are temporary.
“We’re basically looking at the next three months compared to no activity being recorded. Not only is the record low, but no activity is recorded as a function of blockade,” she said. Said. “Of course, you will start looking at the consumer price index [Consumer Price Index] Creeping, inflation expectations rise. “
Agati lists higher prices woodHealthcare and childcare as examples of inflation already on the market.
“This is not the kind of thing that is likely to be a long-term risk of economic recovery,” she added.
Agati, who oversees the company’s $ 170 billion assets, believes the threat of tax increases will bring about a recession in inflation later this year.
“The moment the tax hike goes back to the equation, I think it will put a brake on things and calm things down a bit in the bond market,” Agati said.
But it’s also a challenge for equities.
“It will certainly happen Brake the stock market From the perspective of the trajectory of profit growth, “he said.
PNC strategists say the resumption of trade is “too much, too fast.”
Source link PNC strategists say the resumption of trade is “too much, too fast.”