President Donald Trump’s policies have shaken up Wall Street and silenced the “buy-the-dip” bulls who have dominated the market for nearly two decades, according to Bloomberg. Instead, investors are now being advised to lock in profits and wait for the uncertainty to pass. As Dave Mazza, the CEO of Roundhill Investments, puts it, “Buying the dip now is like buying discounted tickets to a show without knowing who’s performing.”
Elevate Your Investing Strategy:
- Take advantage of TipRanks Premium at 55% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence.
The main concern is Trump’s trade policies, which have created a volatile market environment. Burns McKinney, who is a Managing Director at NFJ Investment Group, notes that “uncertainty is probably here to stay for a while.” This uncertainty has led to a steep pullback in the S&P 500 (SPX), which is now on the brink of a technical correction – a drop of 10% or more from the peak.
Despite some attempts at a rebound, the market remains cautious. Ted Mortonson, a Managing Director at Robert W Baird & Co., is advising investors to focus on “capital preservation” mode as the market faces spring headwinds. However, some experts, like Shana Sissel, who is the Chief Investment Officer at Banrion Capital Management, still see opportunities to buy quality stocks at attractive prices. This overall sentiment seems to imply that we are currently in a stock picker’s market as overall uncertainty will continue to hammer broad-based ETFs.
Is SPY a Buy Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on the SPDR S&P 500 ETF Trust (SPY) based on 414 Buys, 84 Holds, and seven Sells assigned in the past three months, as indicated by the graphic below. After a 17% rally in its share price over the past year, the average SPY price target of $683.40 per share implies 23.6% upside potential.
