Futu Securities app learned that Ed Yardeni, a well-known Wall Street figure who has long been bullish on the U.S. stock market and is the founder of the renowned investment firm Yardeni Research, recently stated in an interview that due to the unexpectedly large 50 basis point rate cut by the Federal Reserve last week, initiating a loose monetary policy cycle, the U.S. stock market may experience a "melt-up" market - a trend of skyrocketing stock prices reaching new historical highs constantly, ultimately similar to the late 1990s Internet bubble. This Wall Street veteran also mentioned that if the Federal Reserve and other global central banks do not adopt a cautious stance, it could lead to a rapid resurgence of inflation.

Yardeni stated that the Federal Reserve's recent policy decision has increased the likelihood of a stock market "melt-up" from 20% to 30%. The best explanation for the term "melt-up" is the scenario of the Internet bubble period - during that time, the S&P 500 index surged over 220% from 1995 to the end of the last century.

In a recent report, this Wall Street veteran predicted that the S&P 500 index is likely to surpass the breakthrough historical high of 5800 by the end of the year, compared to the index's closing at around 5718 points near its all-time high on Monday. Yardeni, in a recent interview, expressed even more bullish sentiment towards the U.S. stock market, suggesting that under the impetus of the Fed's rate cut of 50 basis points to kickstart a loose monetary policy cycle, the S&P 500 index may rise above 6,000 points.

Yardeni also believes that the probability of a long-term bull market in U.S. stocks is as high as 80%, while retaining a 20% possibility to address stock market volatility scenarios like the turmoil of the 1970s - when including the U.S. stock market, global stock markets plunged into prolonged turmoil due to inflation rates and geopolitical tensions.

The Wall Street veteran reminds investors to remain cautious: the Fed's rapid easing could pose risks.

However, while Yardeni remains bullish on the U.S. stock market, he also advises investors to maintain a cautious stance while profiting, stating that if global economic growth begins to overheat, there could be larger risks involved in risky assets such as stocks.

"If they(global central banks) overheat the economy, resulting in continuous stock market bubbles, they will generate a series of issues," Yardney emphasized in a media interview on Monday Eastern Time. He added that the Fed seems to overlook the upcoming US presidential election, where both candidates have proposed policies that could reignite the US inflation rate.

Multiple Fed policymakers reiterated their confidence in the decision to significantly cut interest rates to launch a period of loose monetary policy. This to some extent implies that the Fed may still continue to cut rates by 50 basis points subsequently. Yardney believes that such a rapid easing pace may reignite inflation.

Minneapolis Fed President Neel Kashkari stated on Monday Eastern Time that he supports the Fed's decision to cut rates by 50 basis points. However, he personally expects normalization cut measures of 25 basis points at the Fed's monetary policy meetings in November and December. Meanwhile, Atlanta Fed President Raphael Bostic stated that with the risks of managing inflation and employment becoming more balanced, last week's significant rate cut adjustment will help bring the US benchmark interest rate closer to a neutral level.

The S&P 500 index is expected to have a bumpy rise to 6000 by the end of the year, and may continue to set records next year.

This month, the US stock market can be said to have had a rough start, with the S&P 500 index falling over 4% in the first week. However, since then, investors have become more confident in the ability of the Federal Reserve policymakers to boost the US economy through a rate-cutting cycle.But after the bursting of the internet bubble and the Fed's rate cut in 2001, the ROI dropped by more than 10%.This in turn is expected to drive the benchmark S&P 500 index to potentially achieve its best performance in September since 2019 - historically, September has been the worst-performing month of the year for this index.

Yardney once again leans towards his 'long-term bull market view' of the US stock market, believing that under the comprehensive leadership of revolutionary artificial intelligence technology, the market is in a new 'Roaring Twenties' era, characterized by significant productivity leaps, accelerated economic growth, and substantial stock returns. However, he emphasized in the interview that the probability of this scenario has decreased from his earlier prediction of 60% to 50%.

According to a summary of institutional surveys of Wall Street strategists, this seasoned Wall Street veteran Yardney, who is usually one of Wall Street's most optimistic stock market forecasters, has a benchmark target of 5800 points for the S&P 500 index, but he emphasized on Monday that it is possible to surpass 6000 points in an optimistic scenario.

6000 points - a once (at least in 2023 full year) shocking and seemingly radical index forecast, now as the S&P 500 index continues to hit new highs, is aligning with the latest bullish forecasts of many Wall Street strategists. They steadily raise their bullish outlook for the US stock market to keep up with the S&P 500 index's bull market surge of up to 20% this year.

Global top investment institution BMO Capital Markets has the highest forecast for the s&p 500 index, reaching as high as 6100 points, ranking second is another investment institution Evercore ISI, which expects the s&p 500 index to close at 6000 points by the end of the year, and predicts that the ai investment boom may continue to boost the US stock market to 7000 points in 2025.

On the other hand, Barry Bannister, chief stock strategist at Stifel Nicolaus & Co., warned last week that the market is in a groundhog day resembling the internet bubble era, and he personally predicts a possible 13% crash in the US stock market in the fourth quarter. Bannister successfully predicted the bullish trend of the US stock market in 2023, surpassing many top strategists.

Recently, Scott Rubner, managing director of the Goldman Sachs global market division, who accurately predicted the downturn of ai technology stocks triggering a US stock market pullback, holds a bullish stance on the US stock market at least until the end of the year. He believes that the US stock market should rebound by the end of the year, but emphasizes that a significant rebound will only occur after experiencing adverse short-term situations such as technical corrections, fund flows, and pre-election anxiety. Rubner stated that regardless of which US presidential candidate wins, the s&p 500 index may see a year-end rebound stimulated by fear of missing out (FOMO), with the index rising to 6000 points by the end of the year.

With the continuous refreshment of historical highs in the US stock market, Oppenheimer, an investment institution on Wall Street,Technical AnalysisThe team believes that there are almost no signs indicating that the market is about to peak. The institution is encouraged by the statistical fact that over 60% of stocks listed on the NYSE are above the 200-day moving average, which is a healthy bullish sign for the market as it indicates that the rise in the market is driven not only by a few large technology companies including Apple, Nvidia, and Microsoft.

"If the current US stock bull market follows historical average levels, the US stock market may continue to rise until the end of 2025, with the s&p 500 index reaching around 7000 points." Oppenheimer stated in a recent bullish trend research report on the US stock market.