We will continue to review and expand on our thought processes behind these forecasts in next week’s Weekly Market Commentary.
Conclusion
We believe stocks have fallen to levels that are very close to a market bottom such that the next phase would be an upward-trending market. At that point, we would consider the environment very attractive based on our assessment of economic and market fundamentals. At that point, we would be thinking about upgrading our equities recommendation to overweight from market weight, which we lowered from overweight in March 2019 after stocks got off to a strong start to the year. But we want to err on the side of caution, which is where our playbook comes in. We will continue to monitor new COVID-19 cases, economic data and policy news to determine an appropriate time to make an adjustment.
For now, our best advice for long-term investors would be to consider staying the course while we wait for more signs of progress in terms of the market’s bottoming process. We will continue to keep you updated on our views on the economy and markets on the LPL Research blog and other LPL Research communications as this difficult situation develops. From all of us on the LPL Research team, we wish all of you and your families the best of health. Everyone please stay safe.
Burt White is chief investment officer for LPL Financial.