Fundstrat co-founder and managing partner Tom Lee says that the stock markets still have upside potential despite the S&P 500 and Dow Jones hitting new all-time highs.
In a new interview on CNBC Television, Lee says there is still “a lot of upside” for stocks as the markets appear to be broadening.
“I think there’s a lot of upside, especially because once you get an ISM (Institute for Supply Management report) back above 50, it really does argue for a broadening of markets. And I think one of the leaders probably comes from the financial sector. So I think towards the end of the year, 6,800-7,000 is possible.”
Lee goes on to note some of his favorite plays in the markets, which include artificial intelligence (AI), Bitcoin (BTC), Ethereum (ETH), financial companies, industrials, small caps and Magnificent 7 stocks.
“You want to be long I and the crypto trade because those have been the market leaders. So the Mag-7, Bitcoin, [and] Ethereum. But the broadening is really the financials, industrials and small caps.”
Lee goes on to compare Wall Street adopting blockchain technology to the US moving away from the gold standard in 1971, noting that Ethereum could have a similar moment.
“It’s a lot like 1971 when the US dollar went off the gold standard. That created the innovation of Wall Street, because they had to sort of essentially create this synthetic dollar. Wall Street moving on to the blockchain is a bigger moment. And I think that’s why Ethereum is essentially having its 1971 moment equivalent.”
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