The roar of Wall Street’s new biggest bull is a bit bearish. Chris Harvey of Wells Fargo Securities raised his year-end price target for the S&P 500 by about 20% this week. However, he is not enthusiastic about the market’s path to higher prices. “It’s weird. It doesn’t sound good. But as high as we are on Wall Street, I’m not optimistic,” the firm’s head of equity strategy told CNBC’s “Fast Money” on Tuesday. “It’s not like, ‘Wow, the P/E ratio is so cheap. Everything is going to be great. The economy is hot. The Fed is cutting interest rates, and they’re going to start making deep cuts tomorrow,'” Harvey once said of himself at a conference. On Monday, a CNBC interview called him “not a real positive guy,” raising his official 2024 target for the S&P 500 to 5,535. This represents an increase of approximately 6% from Tuesday’s closing price of 5,209.91 points. Harvey made his comments about “quick money” the day before the Labor Department releases its March consumer price index report. He said the economy was in a downturn. However, he believes stocks could still move higher with big tech and growth companies taking the lead. “Large-cap stocks don’t need a strong economy because market share will change. The winners, the more profitable, faster-growing companies will get more market share,” Harvey said. “So you don’t need that growth if the winners continue to win, which is what we’re counting on.” Between now and the end of the year, he recommends a balanced approach to investing. He likes to be overweight communications services and sees artificial intelligence as a secular story. “If you maintain the status quo, growth will be good. It’s good for growth. It’s good for momentum, it’s good for large-cap stocks,” Harvey added. “If we start seeing rates go lower, what works? The unpopular things: utilities, small caps, more leveraged companies.” Harvey’s end-2023 target for the S&P 500 is 4,420. The index ended the year up 24.2%, closing at 4,769.83 points.Disclaimer
