Latest news with #Pimco
Yahoo
3 days ago
- Business
- Yahoo
Buy stocks, sell bonds: How billionaire investor Bill Gross says investors should play an unpredictable market
Bond King Bill Gross says he's not very bullish on Treasurys. Gross is more optimistic about stocks, eyeing a "little bull market." He thinks the 10-year Treasury yield will struggle to fall much further from current levels. Billionaire investor and former Pimco co-founder Bill Gross has a cautious outlook on the bond market, but see continued strength ahead for stocks. The "Bond King" shared his take on both markets this week in a post on X, predicting a "little bull market" for stocks and a "little bear market" for bonds. In his view, the 10-year Treasury yield isn't likely to dip below 4.25% soon, highlighting inflationary trends and deficit concerns. The yield on Tuesday was up slightly by about one basis point to 4.31%. Gross sees more strength in the equity markets and maintains that stocks are likely to continue rising. He cites support from the tech sector, specifically artificial intelligence companies, as a likely growth driver. Tech stocks are enjoying continued momentum, with the Nasdaq 100 index closing at a record high on Tuesday as markets cheered the Israel-Iran ceasfire. Major chip companies with high AI exposure, such as Nvidia, Advanced Micro Devices, and Broadcom, have all trended upward despite the high uncertainty generated by geopolitics in recent weeks. Gross's thesis is for AI to support economic growth of 1%-2%. Regarding bonds, he said "deficits/ensuing supply of bonds/and a weak dollar should keep CPI from falling below 2.5% and the 10 year from falling below 4.25%." As Treasurys are a lending benchmark for many consumer products, Gross's predictions for yields to remain elevated could complicate plans for everyday Americans. If yields remain stubbornly high, homebuyers looking for lower mortgage rates could be disappointed. Despite the unpredictable nature of the current economy, Gross adds that for now, he doesn't see anything "too dramatic" happening in either the stock or bond market. Read the original article on Business Insider Sign in to access your portfolio
Yahoo
3 days ago
- Business
- Yahoo
Buy stocks, sell bonds: How billionaire investor Bill Gross says investors should play an unpredictable market
Bond King Bill Gross says he's not very bullish on Treasurys. Gross is more optimistic about stocks, eyeing a "little bull market." He thinks the 10-year Treasury yield will struggle to fall much further from current levels. Billionaire investor and former Pimco co-founder Bill Gross has a cautious outlook on the bond market, but see continued strength ahead for stocks. The "Bond King" shared his take on both markets this week in a post on X, predicting a "little bull market" for stocks and a "little bear market" for bonds. In his view, the 10-year Treasury yield isn't likely to dip below 4.25% soon, highlighting inflationary trends and deficit concerns. The yield on Tuesday was up slightly by about one basis point to 4.31%. Gross sees more strength in the equity markets and maintains that stocks are likely to continue rising. He cites support from the tech sector, specifically artificial intelligence companies, as a likely growth driver. Tech stocks are enjoying continued momentum, with the Nasdaq 100 index closing at a record high on Tuesday as markets cheered the Israel-Iran ceasfire. Major chip companies with high AI exposure, such as Nvidia, Advanced Micro Devices, and Broadcom, have all trended upward despite the high uncertainty generated by geopolitics in recent weeks. Gross's thesis is for AI to support economic growth of 1%-2%. Regarding bonds, he said "deficits/ensuing supply of bonds/and a weak dollar should keep CPI from falling below 2.5% and the 10 year from falling below 4.25%." As Treasurys are a lending benchmark for many consumer products, Gross's predictions for yields to remain elevated could complicate plans for everyday Americans. If yields remain stubbornly high, homebuyers looking for lower mortgage rates could be disappointed. Despite the unpredictable nature of the current economy, Gross adds that for now, he doesn't see anything "too dramatic" happening in either the stock or bond market. Read the original article on Business Insider Sign in to access your portfolio
Business Insider
3 days ago
- Business
- Business Insider
Buy stocks, sell bonds: How billionaire investor Bill Gross says investors should play an unpredictable market
Billionaire investor and former Pimco co-founder Bill Gross has a cautious outlook on the bond market, but see continued strength ahead for stocks. The "Bond King" shared his take on both markets this week in a post on X, predicting a "little bull market" for stocks and a "little bear market" for bonds. In his view, the 10-year Treasury yield isn't likely to dip below 4.25% soon, highlighting inflationary trends and deficit concerns. The yield on Tuesday was up slightly by about one basis point to 4.31%. Gross sees more strength in the equity markets and maintains that stocks are likely to continue rising. He cites support from the tech sector, specifically artificial intelligence companies, as a likely growth driver. Tech stocks are enjoying continued momentum, with the Nasdaq 100 index closing at a record high on Tuesday as markets cheered the Israel-Iran ceasfire. Major chip companies with high AI exposure, such as Nvidia, Advanced Micro Devices, and Broadcom, have all trended upward despite the high uncertainty generated by geopolitics in recent weeks. Gross's thesis is for AI to support economic growth of 1%-2%. Regardin bonds, he said "deficits/ensuing supply of bonds/and a weak dollar should keep CPI from falling below 2.5% and the 10 year from falling below 4.25%." As Treasurys are a lending benchmark for many consumer products, Gross's predictions for yields to remain elevated could complicate plans for everyday Americans. If yields remain stubbornly high, homebuyers looking for lower mortgage rates could be disappointed. Despite the unpredictable nature of the current economy, Gross adds that for now, he doesn't see anything "too dramatic" happening in either the stock or bond market.
Bloomberg
5 days ago
- Business
- Bloomberg
US Could See Potential 'Whiff' of Stagflation: Clarida
Richard Clarida, global economic adviser at Pimco and former vice chair of the Federal Reserve, discusses the inflation situation in the US. "If we do get stagflation, it's not going to be the bad old days of the Seventies," Clarida tells Bloomberg's Francine Lacqua. "We'll have a whiff, potentially a whiff, of stagflation." (Source: Bloomberg)
Yahoo
21-06-2025
- Business
- Yahoo
3 reasons the US stock market could crash in September 2025
The US stock market's close to another all-time high, at least when looking at the S&P 500 index. That's terrific for anyone who's been snapping up shares in recent years. However, despite the seemingly strong investor sentiment, there are some potentially massive risks being overlooked, several of which could even trigger a full blown crash later this year. There are several concerning trends that the market is seemingly ignoring. I think the three biggest are: The investment management company Pimco has recently calculated the cyclically adjusted price-to-earnings (CAPE) ratio of the S&P 500 to be in the 94th percentile. That's a fancy way of saying US stocks are trading at earnings multiples significantly higher than their historical average. And historically, such a high CAPE has been a prelude to major market crashes as in 1987 and 2000. At the same time, new tax cuts and higher government spending in the US during a time of fiscal instability and tariff uncertainty create a lot of complications for the Federal Reserve. With fears of inflation potentially making a comeback, the central bank could be forced to start hiking interest rates again. And that might spark a fresh wave of corporate defaults given the growing bubble of overleveraged balance sheets. Beyond brewing trade wars, conflicts have started popping up across the globe, particularly in Eastern Europe and the Middle East. Continued escalation of tensions could lead to even further supply chain disruptions, oil price shocks, or a capital migration to gold, which could spark significant volatility in the stock market – particularly among the businesses trading at lofty valuations. As we approach the end of summer, the impact of current macroeconomic uncertainties is expected to emerge. That means September could be the tipping point. Does that mean a crash is guaranteed to happen? Of course not. Geopolitical tensions could calm while economist forecasts could be completely wrong (it wouldn't be the first time). So what should investors do? Trying to time the market is a strategy that almost never works. Instead, holding through the storm has been a far more successful strategy in the past. Having said that, trimming large portfolio positions might be prudent, especially if the stocks are trading at a lofty valuation. Take Nvidia (NASDAQ:NVDA) as an example. The GPU chip designer has been one of the best-performing US stocks over the last five years, thanks to skyrocketing demand for its technology. The explosion of artificial intelligence (AI) infrastructure investments by data centres has translated into triple-digit profit growth, propelling the market-cap well beyond $3trn. However, economic turbulence from the macro-environment could cause AI-related spending to slow significantly. That could potentially wipe out a significant chunk of its income stream. In such a scenario, a sharp share price drop wouldn't be surprising – especially for a company operating in the cyclical semiconductor space. That's why investors with a large position in Nvidia today may want to consider potentially trimming their exposure. If a crash does emerge, there are going to be some fantastic, high-quality companies going on sale. And by having a watchlist to top up on top-notch stocks, investors can be ready to consider incoming bargains like (possibly) Nvidia if they're not already invested. The post 3 reasons the US stock market could crash in September 2025 appeared first on The Motley Fool UK. More reading 5 Stocks For Trying To Build Wealth After 50 One Top Growth Stock from the Motley Fool Zaven Boyrazian has no position in any of the shares mentioned. The Motley Fool UK has recommended Nvidia. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors. Motley Fool UK 2025 Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
