Phil Camporeale, a portfolio manager working at the global allocation strategy – JP Morgan Chase & Co.’s asset management department, thinks that the U.S. stock market is bullish for the time being.
Camporeale overweight U.S. equities in his opinion, and added more exposure to the S&P 500 while discussing the current market scenario. He stated that he increased his equities allocation to 67% from his previous position at 65%. His portfolio holds major stocks in the U.S market followed by Europe.
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Camporeale is Bullish on S&P 500
Camporeale said that the market is in the “mid-cycle” stage. He picks the large-cap stocks based on the growth and value factors. He says that the delta variant wave of COVID-19 slowed economic growth in the country, but now the scene seems to be improving and optimistic as the consumer spending along with subsiding is strong.
Meanwhile, the Federal Reserve’s monetary policy is dovish as per Camporeale. The Fed’s been looking forward to large employment across the nation before it tightens the policy by hiking the interest rates.
Camporeale said, “That’s bullish for taking risks in the U.S.” According to him, the 50 basis points of rate hikes in Fed funds futures is highly unlikely, as the central bank is not going to taper the assets before mid-2022.
The 10-year Treasury note is trading at a good level and the yield on it has risen recently, said Camporeale who invests in stocks and bonds.
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He thinks that the Fed is catching up with the curve with the monetary policy. He added, “If the Fed was perceived to be behind the curve, I think the yield curve would be a lot steeper.”
The 10-year Treasury note’s yield is trading around 1.64%, which was around 1.2% in mid of July.