Jonathan Golub says that the economy is on fire
One of Wall Street’s most prominent bulls isn’t bouncing on the growth stock bandwagon.
Despite Nasdaq’s run to record, Credit Suisse’s Jonathan Golub chooses value trades right now.
On Wednesday, the firm’s chief U.S. equity strategist and head of quantitative research talked to CNBC. He said that the second quarter of this year would be the fastest GDP quarter they had since 1952. So basically, the economy is on fire.
This week, growth, including technology, was catching a tender with the benchmark 10-year Treasury Note yield falling to February lows. On Wednesday, the yield dropped below 1.35% at one point.
Golub said that if you believe things are slowing, then you need to be a growth investor. You want to be twisting back towards tech, and that’s precisely what’s been happening with the falling interest rates.
Just screaming to the upside
A long-term tech bull Golub believes the value will outperform the group in the next five to 17 months.
Golub added that there is more economic demand right now.
His S&P 500 target is 4,800, implying an 8% gain from the all-time high achieved on Wednesday. In the meantime, the Dow began to decrease by one percent from its record high.
The expert said that if you take a look at individuals, they are sitting cleaned with cash. That is, in his perception, a highly supportive backdrop.
Golub confirms that the market might have a hiccup between now and at the end of this year. However, it could not crash his bull case for stocks.
Golub said that they know that they will not experience this level of economic growth in one year from now, as it is not sustainable. He added that they see inflation as temporary, and this also won’t remain here forever.