Fisher Investments Reviews Sector Leadership Looking Ahead

Summary

In this insightful video, Ken Fisher discusses the current state of the stock market, emphasizing that we are in the latter stages of a unique bull market influenced by the COVID-19 pandemic. He highlights the ongoing outperformance of tech stocks compared to non-tech and predicts that value stocks may begin to close the gap with growth stocks as interest rates decline. Fisher also addresses the global impact of central bank policies and the importance of staying informed about market dynamics. Looking ahead, he suggests potential trends for 2025 while encouraging viewers to remain flexible in their investment strategies.

Takeaways

• 📈 The market is currently in the latter stages of a bull market, influenced by unusual circumstances from COVID-19.
• 💡 Predicting sector performance over 18 months is challenging, and investment strategies should be flexible as market conditions change.
• 🖥️ Technology stocks have consistently outperformed non-tech stocks during the current bull market, especially on volatile market days.
• 📊 There has been a shift towards value stocks outperforming growth stocks, particularly noted in the third quarter of 2024.
• ⚡ Energy stocks have underperformed compared to other value sectors, contrary to previous expectations.
• 🌍 Global monetary policy is as important as U.S. Federal Reserve actions, affecting investment strategies across markets.
• 🏦 Value stocks are more reliant on bank financing than growth stocks, making them more sensitive to interest rate changes.
• 🔍 Fisher anticipates that if the bull market continues, trends favoring value stocks will likely persist into 2025.
• 🚫 If the market turns bearish in 2025, defensive stocks like consumer staples may outperform other sectors.
• 📅 Fisher will provide a detailed forecast for 2025 in December, which will help clarify expected sector performances.

Q & A

What does Ken Fisher say about the current state of the bull market?

Ken Fisher believes we are in the latter stages of a bull market, which has been somewhat unusual due to the circumstances since COVID-19, but he does not think it has ended yet.

How has the performance of Tech stocks compared to non-Tech stocks?

Tech stocks have consistently outperformed non-Tech stocks, leading on days when the market is up and lagging less on days when the market is down.

What recent trend has been observed regarding value and growth stocks?

In the third quarter of 2024, value stocks have begun to outperform growth stocks, a trend that Fisher expected would happen.

What is Fisher's opinion on the importance of the Federal Reserve's actions?

Fisher argues that the importance of the Federal Reserve is often overstated, and that monetary policy from other central banks is equally, if not more, significant.

How do interest rates affect value and growth stocks differently?

As short-term interest rates decrease, value stocks, which rely more on bank financing, are likely to benefit more than growth stocks, which have various financing options.

What was Fisher's prediction about energy stocks?

Fisher acknowledged that he was wrong in expecting energy stocks to perform better; instead, they have continued to underperform compared to other value stocks.

What does Fisher suggest investors should do if the bull market continues?

If the bull market continues, Fisher suggests that the trends favoring Tech and value stocks will likely persist.

What stocks does Fisher recommend focusing on if the market declines in 2025?

If the market declines, Fisher recommends focusing on defensive stocks, such as consumer staples.

Why does Fisher wait until December to make his annual market predictions?

Fisher typically waits until December to make his predictions for the upcoming year due to various reasons, including waiting to assess market conditions in October and November.

What can investors learn from Fisher's perspective on market trends?

Investors should remain adaptable and continuously reassess their strategies based on changing market conditions, rather than relying on fixed predictions.