Marc Lasry on Market, Trump, and Investments

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Marc Lasry on Market, Trump, and Investments PART 1 OF 6

Marc Lasry: ‘Market Might See a 10% Rally in 2017’

Marc Lasry’s interview with CNBC

In an interview with CNBC on Wednesday, January 4, 2017, billionaire Marc Lasry, chief executive officer of Avenue Capital Group, talked about his views on the market (QQQ) (SPY) after the US presidential election. Here are some of the things he talked about:

  • central banks and the current interest rate scenario
  • US economy (IWM) (VFINX)
  • president-elect Donald Trump’s cabinet selection
  • the biggest risk to the market

Marc Lasry: &#8216;Market Might See a 10% Rally in 2017&#8217;

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Lasry’s view on the market

According to Lasry, positive sentiment is driving the markets. In the last three quarters, we’ve been seeing positive and impressive economic growth in the US economy (IVV) (VOO). In 3Q16, the economy had a growth rate of 3.5%. Positive economic growth will be an important driver for the market rally.

The S&P 500 index rose 9.5% in 2016. It has gone through various macro events in 2016 such as China’s economic slowdown shock, the United Kingdom’s Brexit decision, the US elections, and the Federal Reserve’s interest rate hike. The index showed a strong rally after the outcome of the US election.

Lasry said, “It’s all positive because people think you’re going to have positive GDP growth. You’re going to have less regulation. I think if you have this 2 to 3 percent or 3 to 4 percent GDP growth that’s actually very good for equities. So I would tell you equities this year should be up at least 10 percent.”

The stock market is a leading indicator of the economy. When the market makes a new high, then sentiment behind the economy also improves. An optimistic view of the economy and a pro-business sentiment are currently driving the market movement. As expectations for positive economic growth improves, Lasry believes we could see a 10.0% rally in the market in 2017.

In the next part of this series, we’ll look at Lasry’s view on the earnings and valuations of the markets.


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