Investment bank Oppenheimer said that if the Federal Reserve cuts interest rates within the next few months, the top of the market may not appear until 2025.
The Zhitong Finance App learned that investment bank Oppenheimer said on Monday that looking back at the similarity with the macro environment from 1987 to 1990, the S&P 500 index is expected to rise. The main conclusion drawn from the 87-90 roadmap is that the Federal Reserve first cut interest rates was 4 months ahead of the top of the market breadth and 12 months ahead of the top of the S&P 500 index.
“Assuming the Federal Reserve cuts policy interest rates within the next few months, this means that the top of the market may not appear until 2025. Currently, we believe that the beta breakthrough will support the continuation of the bull market.” Oppenheimer said in an investor statement.
Regarding this outlook, Oppenheimer also pointed out that infrastructure stocks would be a buying opportunity, and specifically mentioned the GlobalX US Infrastructure Development ETF (PAVE.US).
The investment bank said, “Compared to the S&P 500 index, PAVE is gradually rising from a year-long consolidation range. We think this is an indication that the ETF has regained its long-term leading position. This will be an extremely attractive beta source, and its broad bottom-up benefits will also bolster our confidence.”
Some other buying opportunities suggested by Oppenheimer include AECOM (ACM.US), Atkore Inc. (ATKR.US), Acuity Brands (AYI.US), Carlyle Partners (CSL.US), H&E Equipment Services (HEES.US), Nucor Steel (NUE.US), Pentair (PNR.US), Reliance (RS.US), Steel Dynamics (STLD.US), Summit Materials (SUM.US), Advanced Draining Systems (WMS.US), and Zurn Elkay Water Solutions Corporation (ZWS.US).
Additionally, Oppenheimer also said that in order to hedge beta risks, it is recommended to sell certain high-beta loss stocks, including iShares U.S.Medical Devices ETF (IHI.US), AtriCure (ATRC.US), CONMED Corporation (CNMD.US), Inspire Medical Systems (INSP.US), and NovoCure Limited (NVCR.US).