Don't sell during the Russia-Ukraine 'panic' because stocks will bounce back, Fundstrat's Tom Lee says
- Stocks should rally in the second half of 2022, and investors shouldn't sell during the Russia-Ukraine "panic",
Fundstrat's Tom Leesaid.
- He said stocks often fall in the run-up to an invasion, then rally when the incursion itself occurs.
Stocks should rally again in the second half of the year, and investors should be wary of selling during the Russia-Ukraine "panic", Fundstrat's Tom Lee has said.
"We think any panic around Russia-Ukraine will be short-lived. And hence, we would not be sellers on this panic," Lee, the former head of equity strategy at JPMorgan, wrote in a note to clients Tuesday.
Stocks have fallen sharply in recent days as Western governments warned that
Lee, a well-known market bull, said there were a number of reasons to stay committed to the market despite the range of worries that are troubling investors.
One is that
He said US companies have little exposure to Russia, and that falls in stock prices are due to fear and uncertainty rather than any fundamental impact on earnings from the situation.
The fading of the Omicron coronavirus wave should add to tailwinds behind the economy, as consumers get spending again, the strategist added.
"The set-up remains that we see equities as treacherous in 1H but stronger in 2H," Lee wrote, referring to the first and second halves of the year.
The S&P 500 index of blue-chip
Analysts at Goldman Sachs said Monday the S&P 500 could fall a further 6% if there is outright conflict in Ukraine and Western governments impose harsh sanctions on Russia.
Many strategists have cautioned that the outlook is unusually uncertain and that volatility is likely to stick around over the coming months.
Mark Haefele, chief investment officer at UBS Global Wealth Management, said in a note Tuesday: "We think investors with diversified portfolios and a long-term investment plan would be well-prepared in case of an escalation as well as a relaxation of tensions."
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