U.S. stock futures were flat early Sunday night. The Dow Jones Industrial Average futures ticked up, adding 37 points or 0.1%. The good news persisted following a record-setting week on Wall Street. The Dow Jones Industrial Average index increased by an estimated 0.1%. Futures tied to the S&P 500 and Nasdaq-100 both rose too.
Fundstrat head of research Tom Lee is getting bullish on the S&P 500. Based on the current inflow of liquidity, he’s forecasting that it will reach at least 7,000 points before the end of the year. This target, he said, might even be exceeded thanks to an even more favorable market environment.
“Nevertheless, we think this is a ‘sidebar’ issue and probabilities heavily favor stocks remaining strong from October to December this year. In fact, we see S&P 500 reaching at least 7,000 by year-end — and maybe higher.” – Tom Lee, head of research at Fundstrat.
The uncertain impacts of the government shutdown have sent the markets into a tizzy. Most importantly, it has stalled the release of important economic data—including the September jobs report that was due out last Friday. Advertisement To many lawmakers, including Lee, that closure represents something of a blip. He calls on investors to remain optimistic about the overall strength of the stock market.
Lee urged investors to see past the challenges created by the shutdown and the absence of many economic data points. If there is a weakness in stocks going forward, he said, that’s an opportunity to buy.
“We would urge looking through the messiness of the shutdown, and even the lack of data. If stocks are particularly weak, I would use this to ‘buy the dip.’” – Tom Lee, head of research at Fundstrat.
The Dow too had a positive week, fueling hopes of a bullish short-term trend in the market. Investors are preparing for the fourth quarter of this calendar year. Investors are understandably eager to see how these dynamics play out, particularly with the backdrop of continued fiscal ambiguities.