Fundstrat’s Tom Lee, identified for his constantly bullish fairness predictions, thinks sure classes of shares may face a bear market later this yr.
Lee says in a brand new CNBC interview that components of the inventory market look susceptible attributable to “midterm seasonality,” petroleum shortages and a wave of upcoming preliminary public choices (IPOs) that he says may trigger a provide overhang.
However the Wall Avenue veteran does assume the upcoming bear market will spare sure outstanding sectors.
“I believe there’s going to be a bear market in different shares later this yr, sure, however I believe it’s going to spare the Magazine-7 and software program.
So it’s going to be names that both received lofty or are going to be affected by the actual fact that there’s a lot of provide of latest inventory later this yr, or the businesses which can be going to get hit by the scarcity of petroleum merchandise. So I believe there are causes that we may have headwinds later this yr.”
Lee provides that semiconductor shares “may develop into a bubble.”
“To me, they don’t look like a bubble but. When Nvidia’s buying and selling at 19 occasions earnings, I believe it’s nonetheless an excellent danger/reward, however I believe that there are components of that ecosystem which have develop into fairly costly.”
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