SocGen: Fed Cuts Set Stage for Equal-Weight S&P 500 Rally It’s Fed Day, and despite market bumps, 2025 has been a standout year for investors. Societe Generale strategists believe the strength can continue as the Federal Reserve cuts rates in a non-recessionary backdrop. So far, none of the 28 asset classes in SocGen’s recommended portfolio — from European bonds to gold — are negative this year. Looking ahead, they see room for more gains and are shifting allocations: raising equities to 50% from 44%, trimming cash to 5% from 10%, and slightly reducing bonds to 35%. History shows that dovish Fed policy supports global equities. While U.S. growth exceptionalism is fading, earnings remain resilient — boosted by AI, stronger profits beyond tech, rising fiscal spending, and global supply-chain shifts. Together, these factors point to ongoing EPS growth and the potential for the S&P 500 to climb higher, with any pullbacks staying shallow. To capture a broadening market rally, SocGen highlights the S&P 500 Equal-Weight Index and a custom basket of profitable small caps with solid balance sheets. They also project the S&P 500 hitting 7,300 by the first half of 2026. Their bullish stance extends overseas: doubling exposure to Japan, maintaining strong European positions, and adding slightly to emerging markets. They point to Germany’s fiscal push, Japan’s new pricing power, China’s next bull leg, and renewed strength across Europe — especially in Italy and Spain.

Golub: Tech Strength and Solid Economy to Keep Market Rally Alive The S&P 500 logged its 25th record close of the year Monday, shaking off pre-Fed jitters and extending its remarkable run. While some warn the rally looks stretched, Seaport Research Partners’ chief equity strategist Jonathan Golub says fundamentals—not froth—are powering stocks higher. Golub, with portfolio strategist Patrick Palfrey, expects double-digit gains ahead. Their outlook puts the S&P 500 at 6,700 by year-end and 7,300 by late 2026, among the Street’s most bullish targets. Driving the move: resilient earnings and ongoing tech leadership. “We’re not in a 1990s-style bubble,” Golub told MarketWatch. “As long as technology holds up and the economy stays reasonably healthy, valuations can keep rising.” He points to firmer fundamentals—recession odds dropping to 30%, bond yields easing, tight credit spreads, and calmer volatility. “This market isn’t running on emotion. It’s grounded in real earnings and real growth,” he said. For investors, the strategy depends on context. “Buying dips works outside recessions,” Golub noted. “But if growth flips into contraction, it turns into a dangerous play fast.” Risks remain: a slowdown in AI or tech spending, labor market weakness, or policy missteps could threaten the rally. Still, Golub’s bottom line is clear: “The economy doesn’t have to boom. It just can’t reverse—and right now, there’s no sign of recession.”

Henry Blodget on AI Mania: Echoes of the Dot-Com Bubble, With Key Differences Trade negotiations between the U.S. and China looked promising—until headlines hit that Beijing accused Nvidia of antitrust violations. That makes Nvidia a fitting case study for today’s hot-button market debate: is the AI-driven rally another bubble in the making? Valuations certainly raise eyebrows. The S&P 500’s cyclically adjusted P/E ratio is near 38, just shy of dot-com era extremes, Morgan Stanley notes. Enter Henry Blodget—a name synonymous with the internet boom and bust. Once a star analyst before being barred from Wall Street by the SEC, Blodget later founded Business Insider and ran it through its sale to Axel Springer. He sees familiar patterns playing out, but also crucial differences. “Like the Internet, AI is already reshaping far more than tech,” Blodget says. “This year alone, $400 billion is being poured into AI infrastructure. That kind of spending is fueling global growth and markets. If it all unravels, the fallout won’t be confined to Silicon Valley.” Still, today’s setup isn’t a carbon copy of the late ’90s. A large portion of AI investment is in private markets—sparing many retail investors if things sour. And unlike the debt-fueled frenzy of the dot-com years, much of today’s buildout is financed by the cash flows of mega-cap tech giants. That doesn’t mean the risks are small. “If AI collapses, stock markets and commercial real estate will get hammered, data centers will sell for pennies, and hundreds of startups will vanish. But the pain should be more contained,” he argues. Blodget admits his past calls were a mix of right and wrong. He correctly saw the internet’s transformative power, the bubble-like valuations of the late ’90s, and the fact that most dot-coms wouldn’t last. But he underestimated the depth of the crash—strong companies were dragged down too—and the number of eventual winners. He points to the crowded search engine wars before Google dominated as a cautionary tale for today’s AI leaders. “These models consume massive capital and energy. Their progress relative to cost is slowing, and the next big leap always feels just a year away,” he warns. Of course, some players will break through. Blodget’s most famous call was on Amazon, which left dismissive rivals like Barnes & Noble and Walmart far behind. “Executives who mocked e-commerce didn’t last. Investors who said internet stocks were ‘too expensive’ underperformed for years,” he recalls. The only real unknown? Timing. “Is this 1996 or 1999?” Blodget asks. “There’s no way to know.”