Better corporate earnings, along with one or two rate cuts by the Federal Reserve, should act like a "turbo booster" for stocks and send the benchmark S&P 500 to 6,000 by year-end, said James Demmert, chief investment officer of Main Street Research in New York, which manages $2 billion in assets.
"There are trillions of dollars in cash on the sidelines, which means many investors have been missing out on the stock rally over the past year," Demmert wrote in an email on Monday.
"Cash on the sidelines, alongside FOMO or 'Fear of Missing Out,' will likely enter the stock market over the next six months, pushing prices even higher. While sometimes FOMO can be a sign of investors being too exuberant, we think this next round of FOMO will be driven by investors who were too cautious over the past six to 12 months."
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