Investment guru Byron Wien says the stock market will eventually rally to new all-time highs this year despite the rough start.
Wien also told CNBC that he thinks the Fed won't raise interest rates at all this year. He said any real threat of a recession won't come until 2021.
In a preview of his 34th annual list of year-ahead economic, financial market, and political surprises, Wien said he sees the S&P 500 gaining 15 percent in 2019, and exceeding the index's Sept. 21 all-time intraday record, CNBC explained.
"I'm optimistic," Wien told CNBC. "I think the fundamentals are sound," he said.
On what would help stocks, the vice chairman of private wealth solutions at Blackstone said he thinks the Federal Reserve won't raise interest rates at all this year, CNBC explained.
"It's a surprise. Everybody expects thinks it's going to be two or three."
Wall Street was pummeled on Thursday after a revenue warning from Apple (AAPL.O) and slowing U.S. factory activity stoked fears of a global economic slowdown.
The magnitude of Apple’s holiday quarter revenue shortfall sent shockwaves through the technology sector, which pulled all three major U.S. stock indexes down about 2 percent or more.
In a letter to investors on Wednesday after the bell, Apple chief executive Tim Cook said the company had not foreseen the scale of China’s economic deceleration, which was exacerbated by U.S.-China trade tensions. The iPhone maker’s shares were down 9.2 percent.
A report from the Institute for Supply Management showed U.S. factory activity in December suffered the biggest drop since October 2008, the height of the financial crisis. Its PMI reading, while still in expansion territory, hit its lowest level in more than two years.
“There are enough data points out there that point to the fact that the global economy took a sharp downturn as the year drew to a close,” said Peter Tuz, president of Chase Investment Counsel in Charlottesville, Virginia. “Trade and other geopolitical issues are the biggest factors,” he told Reuters.
For his part, President Donald Trump on Wednesday played down the stock market’s drop at the end of 2018, calling it a “glitch” and saying the market will again go up once various trade deals are settled, Reuters reported.
Trump, speaking to reporters at a cabinet meeting, sounded upbeat about negotiations to reach a trade deal with China, saying they are coming along very well.
The United States and China are about one month into a 90-day pause in implementing tariffs and other measures in a trade war that dominated much of 2018, as they work on hammering out a deal.
U.S. trade deals with Canada and Mexico also await congressional approval.
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