3 Month Stock Market Outlook
Today, January 20th, 2021, the US welcomes a new President who is pro-American, Pro-business and anti negative-regulations, with low taxation as a preference to stimulate investment.
The next 3 months might begin slowly as consumers, wage earners, and US businesses escape the doldrums of the last 5 years for a truly wide open market opportunity. By summer, the momentum will be strong. As you’ll note below, employment, wages and consumer spending are okay, and will likely surge this year as Americans become more certain of the American renaissance.
Democrat tractors say Trump is only about helping the wealthy, and that is an issue, which the Democrats didn’t deal with, however, he’s resolving a big problem for Americans and global investors. He’s about to make the US investible again. This means vast amounts of capital are about to converge on the stock markets. And a new era of optimism will make business owners very happy. Hopefully, small businesses will join the party soon too.
After the election of Donald Trump as the next US President, investors will enjoy a clearer view of the road ahead for the economy, bond market, commodities, and stock market. Volatility will recede and make retail and institutional investors and more investors will commit to the best stocks to buy.
In fact, take a quick look at the best stocks to buy right now to begin that journey. That might be AI stocks, ETF’s, cryptocurrency, oil stocks or perhaps small caps if you’re willing to wait.
Stock Market Experts Like What They See
While the 3 month outlook is still volatile, investors are gaining confidence. Last week markets rose strongly giving us a view of how February, March and April will play out. Here are the major market economist predictions for 2025.
Tom Lee discusses his bull market views and advises investors to relax from their wall of worry. He says market indicators are positive heading into year end.
With the move to the right politically, the Democrat media will see their voice and influence weaken considerably. Thus American’s will accept the free market, pro-work ethic and America-first agenda. That’s important to support labor market supply, cut government mispending, and keep wages under control.
Ed Yardeni speaks with Becky Quick of CNBC about his ‘7000 S&P’ outlook for 2026, and 10,000 goal for 2030.
Q1 2025: What’s Next for the Markets?
January is seeing a big move for cryptocurrency. The rise of the various digital coins is almost shocking. Yet President Trump is opening the door for this technology to enter the business financial system and retail/online system in earnest. Time will tell if it deflates the US dollar or makes the US dollar even stronger. Coinbase has exposure to all cryptocurrencies and thus may surge, but you’ll want to be cautious with all of them.
Barcharts list of top-performing stocks in the last month provides a view of some stocks that investors like. And popularity is important. Energy stocks abound given the price of oil and the potential unleashing of demand and consumption in the US, and globally. Whether they still have significant upside is the question. With Iran/Russia sanctions put in effect,
And the FED is expected to end quantitative tightening (sometime this year) which has been a drag on the economy.
The Next Quarter: February, March and April
As we pass through the deep part of winter, consumer spending is weaker of course. Stock market economists believe much of the growth won’t take place until H2, 2025 as the impetus for business gets rolling.
By the end of March, the spending surge will grow as US jobs increase, wages grow, and capital investment money pours into the US economy. As President Trump states, it is a new environment of innovation and growth.
What is already an active economy will expand in a healthier direction not dependent on FED spending and money printing. It’s deregulation itself that will spawn significant research and innovation spending and create high-quality jobs with strong wages, with new more practical solutions to domestic production challenges.
US employed persons is maintaining a steady pace and along with rising wages consumer spending should revive in 2025.
US spending has been slightly volatile but should become firmer as tax cuts kick in and US industry picks up steam in 2025.
Opportunity follows money, so it shouldn’t be a surprise to you that the AI stocks may be the best stocks to buy right now. Prices and P/E ratios are lofty yet the AI era beckons. While cryptocurrency and oil are drawing money away from AI (Nvidia, Palantir, AMD, etc.), cryptocurrency needs processing power, data centers, and energy. That cocktail of stimulants should boost spending on AI and AI company profits.
Artificial intelligence will support massive gains in new services and devices which makes all previous products obsolete. Data centers are the focus, but AI is supercharging everything. Expect the NASDAQ to do very well this year, and will pick up in H2 as the Fed begins easing rates.
Easing rate expectations may stimulate the housing market after we see home prices fall a little in the next 3 months. By summer some demand will return pushing up builder stocks such as Toll Brothers and DR Horton. However, right now, the AI trade is likely going to provide better returns. The housing market’s revival is still a ways off. Buyers right now are struggling with the down payment, and new condos are taking longer to sell.
Have a closer look at some of the projections for the next 3 months, 6 months and 5 years and overall it’s an optimistic picture. See the 6 month economic projections to gauge macro concerns.
Yahoo Finance Top Stocks to Buy
Is Yahoo Finance reliable for stock picking. They have a good set of tools to help you screen in the best equities to consider. Yahoo Finance too, believed these stocks were good bets 10 months ago, and they still remain best bets today.
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- Berkshire Hathaway Inc (NYSE:BRK) +4.17% in last month, p/e ratio of 9.24
- UnitedHealth Group Incorporated (NYSE:UNH) -2.67% in last month, p/e ratio of 20.5
- JPMorgan Chase & Co. (NYSE:JPM) +4.87 in last month, p/e ratio of 11.2
- Oracle Corporation (NYSE:ORCL) -2.24% in last month, p/e ratio of 41.6
- Merck & Co., Inc. (NYSE:MRK) +.62% in last month, p/e ratio of 885.91
- Bank of America Corporation (NYSE:BAC) +4.12% in last month, p/e ratio of 11.6
- General Electric Company (NYSE:GE) +15.21% in last month, p/e ratio of 19.88
- Broadcom Inc. (NASDAQ:AVGO) +12.55% in last month, p/e ratio of 42.4
- Danaher Corporation (NYSE:DHR) +4.09% in last month, p/e ratio of 45.2
- Union Pacific Corporation (NYSE:UNP) +2.57% in last month, p/e ratio of 24.2
- Intel Corporation (NASDAQ:INTC) +2.45 in last month, p/e ratio of 47.2
- Exxon Mobil Corporation (NYSE:XOM) +4.22% in last month, p/e ratio of 11.9
- Walmart Inc. (NYSE:WMT) +4.52% in last month, p/e ratio of 30.7
- Elevance Health, Inc. (NYSE:ELV) +1.79% in last month, p/e ratio n/a
- Johnson & Johnson (NYSE:JNJ) +4.06% in last month, p/e ratio of 31.5
- Pfizer Inc. (NYSE:PFE) +.075 in last month, p/e ratio of 41.6
The next 3 months should offer plenty of opportunity for investors to jump on board the rally that should continue throughout the year, even despite lower corporate earnings. The key here is that as interest rates fall, money will flee the money markets.
Enjoy your hunt for the best individual stocks to buy in 2025, but be sure you’re confident of which sectors will perform best, and how macroeconomic forces affects corporate earnings, opportunities and stock market predictions. Conditions change so quickly.
See more on the 6 month economic outlook, 6 month stocks outlook and the forecast for next week.
