Stock Groups

Correction forecast implies it’s a bad time to deploy cash into stocks


Volatility in the stock market is still quite early.

Wilmington Trust’s Meghan Shue believes that investors will continue to be bullish despite a positive outlook for 2022. She expects wild swings as they digest the Federal Reserve being less accommodating and evaluate new risks associated with the Covid Omicron variant.

CNBC’s investment strategist for the company said, “While we have a lot of equity holdings, we do hold a lot more cash to cover our excesses.”Trading NationOn Friday, ” Cash could become your friend in the next months.

The major indexes are on a losing streak. The DowIt dropped 532 points Friday, and it posted the worst day of January. Last week it fell 1.9%, and the S&P 500 lost 1%.

The tech-heavy are still in the background. NasdaqThe stock market fell by 3%, and it is down more than 6% since its 52-week peak. Nasdaq is known for having a harder time weathering storms. a rising rate and slowing growth environment.

Combining that with high valuations, uncertainty surrounding omicron and continued volatility around it all makes for a winning combination. a recipe for continued volatilityShue is a CNBC contributor.

She expects stocks to recover 10% in the next 2 to 3 months. However, she calls it a buying chance.

“Cyclicals valueStill look very attractive.”Small capsThey are also extremely beaten down. If we can move above omicron we might see a rally there.

Shue is overall positive about U.S. markets and global markets. She oversees $152billion in assets. Her firm’s optimistic 2022 forecast predicts that inflation will rise, supply chain pressures and the labor market will improve.

She stated that “We’re moving back into an acceleration phase of our economic cycle.”

Shue revealed to “Trading Nation,” last month that her company had been acquired its biggest overweight in stocks ever.

“Stocks [are]Shue indicated that Shue believes it will continue to be one the most performing asset classes.