Strategas Research Partners CEO Jason Trennert and The Bahnsen Group Founder David Bahnsen stopped by Wall Street Week with Maria Bartiromo.
Unfortunately, the embed feature on Fox Business broke for this video so I can’t embed it but click the link if you want to watch the whole video.
Here’s a little information on Strategas from their website.
Strategas is a global institutional brokerage and advisory firm. The Firm provides macro research, capital market and corporate advisory services, and financial products to institutional investors and corporate executives, in more than twenty countries, around the world.
And the Bahnsen Group is an investment advisory firm to high net worth investors.
They discussed the recent stock market rally and debated if it would continue.
What fueled the initial Trump rally?
Jason and David both admitted that hope and perception fueled the initial rally.
And I would agree with that.
But it’s what they said next that I found interesting.
They said it was based on hope and perception of his economic agenda getting passed.
His economic agenda hasn’t passed yet so does that mean the rally still has some legs on it?
Will the Trump Rally continue?
Both Jason and David agreed that it would.
While the rally started on hope and perception, stocks continue to go up because of fundamentals.
After 1st quarter earnings came out, earnings were up 14% across the board.
But don’t tell that to retailers, they aren’t doing so well.
So now there is an actual reason for the stock market to go up.
And if earnings growth continues and President Trump passes his economic agenda, the rally should continue.
What investment opportunity looks the most promising?
David Bahnsen brought up an interesting point.
With all of this rallying going on, the energy sector has not participated in it yet.
Energy stocks have a negative return since President Trump took office.
But the energy sector stands to gain the most from President Trump’s economic agenda.
Less regulation will drive down the cost of production.
And a better will economy will increase demand for commodities like oil and coal.
So David thinks energy stocks have the most promise.
It’s sound logic but take it will a grain of salt.
He might have an alternative motive for pushing energy stock prices higher.
After watching the video, I feel better about my investments and the direction of the markets.
The initial Trump rally was based on perception but the continued rally is not.
If earnings continue to go up and President Trump gets his economic agenda approved, the markets should continue to rally.
Until the next surprise happens.
What investment looks promising to you?
Let me know in the comments below.
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