Jeremy Siegel: Stocks Can Thrive Even With Fewer Rate Cuts

Big tech stocks, which drove big market gains last year, maintain their appeal, he suggested.

Higher duration growth stocks — those with higher valuation price-to-earnings multiples based on future cash flows — “have held up very well in the face of these higher interest rates relative to the value stocks. This is not usually the case, but I am attributing this strength to the continued strong performance in the semiconductor companies, which are spreading excitement over the impact from artificial intelligence, AI, technology,” Siegel said.

“For the full year, I still expect greater participation in the rally from a broader cross section of the market, but sentiment still favors the high-quality, big-tech stocks,” he wrote.

Siegel noted the S&P 500 reached an all-time high Friday as the economy showed ongoing strength. A key weekly jobless claims indicator fell under 200,000, the lowest level in nearly 60 years, he said, adding, “That is clearly indicative of strength in the economy.”

(Photo: Lila Photo for TD Ameritrade Institutional)