Tom Lee is a buyer of stocks and says a lot of bad news is already priced in
Tom Lee said the stock market is a buy now that it has priced in much of the bad news, and is poised for a huge rally in the coming months. “I am optimistic. I mean, I can understand why investors are sitting on their hands … they don’t really know how severe these tariffs are gonna be, how long they are,” the head of research at Fundstrat Global Advisors told CNBC’s “Closing Bell” on Wednesday. “But, now we’re seeing a big price correction. A decline in sentiment. And then, something like today, we got a bad ADP jobs report, and the market is actually up,” Lee continued. That means stocks are “rising on bad news, which is a good sign that a lot of bad news is priced in.” In fact, Lee said it is “very possible” that March, April and May could prove “huge rally months,” with stocks rallying 10% to 15%, now that the market has gone through what he considers essentially a bear market in terms of sentiment and an unwinding of the momentum trade. .SPX 1D mountain S & P 500 Wednesday This week, all three major averages slid more than 1% each to start the month, as President Donald Trump’s tariffs, and retaliatory tariffs on U.S. goods, weighed on investor sentiment and future profits. The S & P 500 is now down 1.5% in 2025 and the Nasdaq Composite briefly fell into a 10% correction from its recent high. Regardless, Lee said he is a buyer. On Wednesday, all three indexes rallied, rebounding from their two-day slide, as White House concessions toward automakers soothed investor spirits. “We already know stocks will bottom before bad news peaks,” Lee said. “And so, if we’re seeing the market not fade on bad news, that means we’ve already priced in a lot of things that would scare us.”
