We’re Dreaming of a Green Christmas | Editor’s Note: Tomorrow, December 12, at 7 p.m. Eastern time, Eric Fry, Luke Lango and I are gathering for a special event – the Early Warning Summit 2024 – to give you their investing game plan for 2024. It’s a strategy that could outperform the market by 5X or more next year, no matter what happens. Sign up and reserve your spot for the event here.
Before the event, I wanted to pass along a great article by Luke, where he shares is market outlook for December and beyond. You can read it below. | | | Hey, folks, it’s Luke Lango.
This holiday rally is a doozy! But that’s not all I’m excited about this holiday season.
I think that growing support for a soft landing will kickstart a massive multiyear rally for stocks, but we’ll probably see a small pullback first.
November was a good month for the stock market, and while some indicators are suggesting we’re at a short-term top, a small pullback here isn’t anything to worry about.
I am still confident in the outlook over the coming months and years.
There’s a lot of evidence to support the thesis that stocks are entering a multiyear, secular bull market. For one, the economy is doing wonderfully right now. There’s a strangely huge discrepancy between how the average American believes the economy is doing versus how it’s actually performing. But all signs point to the naysayers being wrong. Things were bad in the past, and that sentiment is hard to shake – but these people are just stuck in the past.
Our indicators show that the economy is doing great, and the once mythical soft landing is now looking like the most plausible outcome. For one, reinflation is a thing of the past, and inflation is now dropping rapidly. Gas prices have been down for 60 straight days.
Inflation is set to come under control without a recession, labor market destruction, or any other black swan event.
Even the Federal Reserve is embracing the soft landing. Their repeated calls of “higher for longer” rates have faded, and a few Fed members are finally beginning to speak out against this strategy.
In the past, every time the economy experienced a soft landing like this, we got a stock market rally — without fail.
Without a recession, earnings estimates can move higher. Then, once the Fed starts cutting, yields come down, which enables PE and earnings multiples to expand. Because stock prices are earnings estimates times PE multiples, a soft landing will ultimately drive both of these factors higher. This will drive stocks higher in the coming one to two years. So, getting back to the short-term top we see on the horizon — we aren’t worried about it. We’ll get a pullback, buy the dip, and then ride the next leg of this rally higher.
Optimism surrounding artificial intelligence will bolster that rally, thanks to IT companies creating their first budgets since ChatGPT took the world by storm. There’s still skepticism surrounding this rally, but we think AI is the real deal.
All that said, stock selection is still a challenge. This won’t be a “throw a dart” bull market.
This rally may lift many stocks, but the tech gap caused by AI will send others straight into the abyss.
That’s why Louis Navellier, Eric Fry and I are taking some time to discuss the New Year’s potential profit opportunities during tomorrow’s Early Warning Summit 2024. The event starts at 7 p.m. sharp, so make sure to reserve your spot today.
Also during the event, we’ll… - Alert you to where the markets are heading in 2024.
- Tell you where you should – and where you shouldn’t – invest your money in the coming year.
- And share three FREE stock recommendations.
Click here and reserve your spot now.
I hope to talk to you then!
Regards, |
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