Cathie Wood, the CEO of ARK Invest, has predicted a potential shift in the equity market, favoring small-cap stocks over large-cap tech companies. This forecast is based on the current "restrictive" monetary policy of the Federal Reserve, as outlined in a recent investor letter on Wednesday.
What Happened: Wood highlighted the potential impact of the Fed's current policy, which is aimed at curbing inflation following the COVID-19 crisis. She pointed out that previous instances of market concentration, such as in 1973 and 2000, were followed by significant market downturns.
In contrast, periods of broader market concentration, such as in 1932, 1964, and 2009, signaled the beginning of broader-based equity bull markets.
Wood suggested that the current risk is a result of the Fed's "restrictive" policy, which is in stark contrast to the "easing" policy of 1973 and 2000. She believes that this could create an opportunity for smaller-cap stocks to outperform the mega caps currently dominated by the "Magnificent Six."
Wood wrote, "In our view, having already paid dues with tight money and higher interest rates in this cycle, the next few years could prove fertile for the broad swath of the equity market beyond the Magnificent Six. As inflation and interest rates continue to unwind during the next few years, smaller-cap stocks should have much more compelling upside potential relative to the mega caps now dominated by the Magnificent Six."
Top U.S. tech companies renowned for their advancements in AI have been pivotal in driving stock market growth. These companies include the "Magnificent Seven" — Microsoft Corp. (NASDAQ:MSFT), Apple Inc. (NASDAQ:AAPL), NVIDIA Corp. (NASDAQ:NVDA), Meta Platforms Inc. (NASDAQ:META), Tesla Inc. (NASDAQ:TSLA), Amazon.com Inc. (NASDAQ:AMZN), and Google's parent company Alphabet Inc. (NASDAQ:GOOG), (NASDAQ:GOOGL).
Last week, Wood acknowledged that the company's flagship fund ARK Innovation ETF's (NYSE:ARKK) performance has been impacted by the shift in focus from the "Magnificent Six" to multiomics stocks, which have been adversely affected by the prospect of prolonged high interest rates.
Why It Matters: This prediction by Wood aligns with a recent surge in small-cap stocks. Market strategist Tom Lee noted that small-caps have been on a tear since Federal Reserve Chair Jerome Powell's Congressional testimony, and the rally in the space is only getting started. Lee predicted a 40% jump in the near term for small-caps.
Wood's prediction also comes in the wake of her optimistic outlook for Tesla Inc. (NASDAQ:TSLA), where she suggested that the company's stock could see a significant surge as it moves into the autonomous taxi business, potentially capturing up to 50% of the autonomous taxi market.
Meanwhile, CNBC's "Mad Money" host Jim Cramer advised investors to consider buying the 'Mag 7' stocks when interest rates rise and to buy everything when rates fall, indicating a potential market strategy shift.
This story was generated using Benzinga Neuro and edited by Kaustubh Bagalkote
Ark Invest首席執行官凱西·伍德曾預測股票市場可能會發生變化,偏愛小盤股而不是大型科技公司。正如週三最近的一封投資者信中所概述的那樣,這一預測基於聯儲局當前的 “限制性” 貨幣政策。
發生了什麼:伍德強調了聯儲局當前政策的潛在影響,該政策旨在遏制 COVID-19 危機後的通貨膨脹。她指出,先前的市場集中情況,例如在1973年和2000年,隨後是市場大幅下滑。
相比之下,更廣泛的市場集中時期,例如1932年、1964年和2009年,標誌着基礎廣泛的股票牛市的開始。
伍德表示,當前的風險是聯儲局 “限制性” 政策的結果,這與1973年和2000年的 “寬鬆” 政策形成鮮明對比。她認爲,這可能會爲小盤股創造一個機會,使其跑贏目前由 “壯麗六強” 主導的大盤股。
伍德寫道:“在我們看來,在這個週期中,已經以緊張的資金和更高的利率繳納了會費,未來幾年可能會爲宏偉六強以外的廣大股票市場帶來肥沃。隨着未來幾年通貨膨脹和利率的持續放緩,與現在由宏偉六強大盤股主導的大盤股相比,小盤股應該具有更大的上行潛力。”
以人工智能的進步而聞名的美國頂級科技公司在推動股市增長方面發揮了關鍵作用。這些公司包括 “壯麗七人” ——微軟公司(納斯達克股票代碼:MSFT)、蘋果公司(納斯達克股票代碼:AAPL)、英偉達公司(納斯達克股票代碼:NVDA)、Meta Platforms Inc.(納斯達克股票代碼:META)、特斯拉公司(納斯達克股票代碼:TSLA)、亞馬遜公司(納斯達克股票代碼:AMZN)和谷歌的母公司Alphabet Inc.(納斯達克股票代碼:Alphabet Inc.(納斯達克股票代碼:AMZN)。GOOG),(納斯達克股票代碼:GOOGL)。
上週,伍德承認,該公司的旗艦基金方舟創新ETF(紐約證券交易所代碼:ARKK)的表現受到焦點從 “壯麗六強” 向多組學股票轉移的影響,多組學股票受到長期高利率前景的不利影響。
爲何重要:伍德的這一預測與最近小盤股的飆升一致。市場策略師湯姆·李指出,自聯儲局主席傑羅姆·鮑威爾在國會作證以來,小盤股一直在波動,該領域的漲勢才剛剛開始。李預測小盤股在短期內將上漲40%。
伍德的預測也是在她對特斯拉公司(納斯達克股票代碼:TSLA)前景樂觀之後做出的。她表示,隨着特斯拉進入自動出租車業務,該公司的股票可能會大幅上漲,可能佔據自動駕駛出租車市場高達50%的份額。
同時,CNBC的 “瘋狂財富” 主持人吉姆·克萊默建議投資者考慮在利率上升時買入 “Mag 7” 股票,在利率下降時買入所有股票,這表明潛在的市場策略轉變。
這個故事是使用 Benzinga Neuro 創作的,由 Kaustubh Bagalkote 編輯