7073彩票注册 could see a double-digit drop in the coming months, warns Wells Fargo

Published: Jan 11, 2020 5:28 p.m. ET

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Even as geopolitical tensions continue to ratchet up, there’s much to be bullish about in the stock market in the New Year — maybe too much, according to Chris Harvey, the head of equity strategy at Wells Fargo Securities.

7073彩票注册“There’s a lot of things to like. Rates are lower, credit spreads are tighter, the Fed has been accommodative, we’ve got some sort of resolution with trade and tariff and sentiment has improved greatly,” Harvey explained to Bloomberg . “And that’s what we don’t like.”

7073彩票注册In other words, when everything starts turning positive and expectations go higher, that’s exactly when investors should be worried.

But they don’t seem to be.

“Typically, when people are a little bit more, what would we say, greedy, as opposed to fearful, it’s not always a great time,” he said, with a nod to Warren Buffett’s BRK.A, +0.57%7073彩票注册 oft-cited market mantra. “With expectations so much higher, we’re just worried that things can change and change rather quickly.’’

Watch: Chris Harvey talks about fearing the Fed in 2020

In contrast — and with the benefit of hindsight — Harvey cited the jittery fourth quarter of 2018 as a great time to buy.

“The wheels were falling off the cart, the world was going to end — it was a fantastic time to get involved,” Harvey said, pointing to the strong returns that followed. “You had great opportunity to invest.”

Bullishness was in short supply in Friday’s trading session, as investors reacted to the U.S. airstrike in Baghdad that killed a top Iranian military commander. Oil prices CL00, +0.07% jumped, while the Dow DJIA, +0.92% ?, S&P 500 SPX, +0.84% and Nasdaq Composite COMP, +1.06% all closed lower. There’s no rebound taking shape on Monday, with futures pointing to a lower open.

7073彩票注册 Shawn Langlois is an editor and writer for MarketWatch in Los Angeles. Follow him on 7073彩票注册 @slangwise.

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