Market Correction Due: Stocks Are Running Out Of Reasons To Move Higher, Analyst Says
Portfolio Pulse from Neil Dennis
Craig Johnson of Piper Sandler predicts a market correction, citing internal sell signals and technical indicators. He expects the S&P 500 to pull back to about 4,600, with a low likely by early April. Johnson suggests a rotation from tech giants like Amazon and Meta Platforms to financials and healthcare, noting underperformance in these sectors in 2023. He anticipates a rally in small- and mid-cap stocks with expected Fed rate cuts by June, maintaining a year-end S&P 500 target of 5,050.
February 12, 2024 | 8:04 pm
News sentiment analysis
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NEGATIVE IMPACT
Amazon may see a short-term impact as investors rotate out of tech giants towards financials and healthcare sectors.
Craig Johnson's recommendation to rotate out of tech giants like Amazon towards financials and healthcare sectors could lead to a short-term negative impact on Amazon's stock as investors adjust their portfolios.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
Meta Platforms may face a short-term negative impact as the market rotates towards financials and healthcare, following analyst recommendations.
The advised rotation from tech giants, including Meta Platforms, to other sectors could result in a temporary decrease in Meta's stock price as investors reallocate their investments.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70
NEGATIVE IMPACT
SPDR S&P 500 ETF may experience a pullback to about 4,600 as predicted by Craig Johnson, with a potential low by early April.
Given the prediction of a market correction with the S&P 500 potentially pulling back to about 4,600, SPY, which tracks the S&P 500, is likely to experience a similar short-term decline.
CONFIDENCE 85
IMPORTANCE 80
RELEVANCE 90
POSITIVE IMPACT
iShares U.S. Financial Services ETF may benefit in the short term from the anticipated rotation towards financials.
As investors are expected to rotate out of tech giants into financials, IYG, which focuses on U.S. financial services, could see a positive short-term impact.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80
POSITIVE IMPACT
Health Care Select Sector SPDR ETF may see a short-term uplift as the market rotates towards healthcare, following analyst advice.
With the advised market rotation towards healthcare, XLV stands to benefit in the short term as it represents the healthcare sector.
CONFIDENCE 80
IMPORTANCE 70
RELEVANCE 80