‘Magnificent Seven’ Warning, IPO Return Among BofA's 10 Surprises on Wall Street
Geopolitical risk lashes the Magnificent Seven. The IPO machine roars back. Japan emerges as the world’s best developed market.
After Byron Wien passed away last year, Bank of America Corp. is the latest to pay homage with their own version of the Wall Street forecaster’s annual list of potential market surprises for 2024.
Another potential wildcard: Stocks luring back investors all thanks to high bond taxes – that’s at the top of the list according to the bank’s strategists led by Jared Woodard.
And despite the most aggressive rate-hiking cycle in decades, companies could sidestep a surge in bankruptcies, they said.
“This year any large moves in markets may be self-limiting. Big drops in stocks could prompt Fed cuts; big rallies further ease financial conditions and rekindle the very inflation that the Fed thought it had smothered,” the strategists wrote. “It’s a recipe for a range-bound, if volatile year, at least in the US.”
For now, they favor credit over equities and bonds in case of more market swings and warn traders not to get “shaken out” of inflation hedges.
Wien, the longtime market strategist whose annual list of “10 Surprises” made him one of the most influential voices on Wall Street during a career at Blackstone Inc. and Morgan Stanley, died in October. Since 1986, his annual surprises list has compiled potential market shocks that Wien saw with a better-than-expected chance of happening.
