Now for the US stock market, I think there are two scenarios.
The more bullish scenario is that the macro issues are temporary. For example, if the Iran negotiations are basically wrapped up within a month and oil prices promptly drop, and US Treasury yields don’t keep climbing in a parabolic fashion—at least staying steady or moving sideways, and even better if they come down a bit—then AI stocks could get another round. From CPUs, to Agents, and then storage, many stocks could potentially move up to test their previous highs, and even break through them.
The bearish scenario is that the Iran issue drags on, and oil prices and US Treasury yields still can’t come down over the next month. If it keeps going until close to the midterm election, the Republican Party is very likely to lose both chambers. Then over the next two years, it will be difficult for many of the policies Trump wants to push to go through. The Democratic Party isn’t as friendly toward AI, which could affect expectations for AI stocks; the stock market would then price in those expectations. In that case, AI stocks might form a kind of secondary top, followed by a pullback before anything else.
Right now my position is roughly 60–70%, keeping some cash, and adjusting as the situation evolves.
The more bullish scenario is that the macro issues are temporary. For example, if the Iran negotiations are basically wrapped up within a month and oil prices promptly drop, and US Treasury yields don’t keep climbing in a parabolic fashion—at least staying steady or moving sideways, and even better if they come down a bit—then AI stocks could get another round. From CPUs, to Agents, and then storage, many stocks could potentially move up to test their previous highs, and even break through them.
The bearish scenario is that the Iran issue drags on, and oil prices and US Treasury yields still can’t come down over the next month. If it keeps going until close to the midterm election, the Republican Party is very likely to lose both chambers. Then over the next two years, it will be difficult for many of the policies Trump wants to push to go through. The Democratic Party isn’t as friendly toward AI, which could affect expectations for AI stocks; the stock market would then price in those expectations. In that case, AI stocks might form a kind of secondary top, followed by a pullback before anything else.
Right now my position is roughly 60–70%, keeping some cash, and adjusting as the situation evolves.