Keep buying the stock market in 2018, the top executive at Hennessy Funds said Tuesday.
The bull market may pause, but it is not going to end, and the economy and the markets will continue to rise even if the Trump administration’s tax cut and code change package doesn’t pass, said Neil Hennessy, the company's chairman, chief investment officer and portfolio manager.
“The bull market is going to stay,” he said at a meeting in Manhattan.
Hennessy predicted the Dow Jones average was headed for 30,000 and more. He was generally so upbeat about the stock market that he said, even if the Trump tax plan is smashed up in Congress, markets would still be heading up next year.
He said the economic climate under a Trump administration will be good. New government regulations “won’t continually come out and burden corporations to such an extent like they did in the prior administration,” Hennessy said. He also expected that retail spending will be rising.
“Don’t count out the consumer,” said Hennessy. He pointed to the strong recent Black Friday spending.
Despite seeing headlines that the market is overvalued, the bull market, which began some eight years ago, still has a long way to go, Hennessy said.
Some headlines, he noted, say that we’ve been in a nine-year bull market and it has to end.
“But it doesn’t have to end. In fact, we are building the road to 30,000 and plus,” said Hennessy. He said the market will likely correct at some point. But then it will start heading up again, said Hennessy, who saw parallels in this market to the Reagan years.
“This market reminds me exactly of the 1982-2000 market, where the market was up each and every year, with the exception of 1990 when it was down one half of one percent,” he said. Low inflation and interest rates were characteristics of those glory years. Hennessy said he sees the same today.