The Wharton Way of life’s Jeremy Siegel isn’t putting on a bear suit anytime soon.
The back professor who just correctly predicted Dow 24,000 sees another milestone approaching.
“As we get to these thousands, of indubitably, each is a smaller increment. I think right now, we’re only three percent from 25 – the next thousand on the Dow,” Siegel alleged Friday on CNBC’s “Trading Nation.”
Siegel has had a solid track secretly over the past 12 months. He led the rally cry for Dow 20,000 late most recent year.
He expects the next leg higher to Dow 25,000 will to come from the tax improvement package. It could provide the momentum the Dow needs to hit that number in a episode of weeks, if not days, according to Siegel.
“I believe it will be passed. I expectation before New Year’s. That would be best,” he added. “The corporate tax cut is peculiarly what I think the market wants. That could boost earnings by 8 percent or so, and that’s a assertive for stocks.”
His comments came as the Senate was preparing to vote on $1.4 trillion tax paper money. On Saturday morning, Senate Republicans narrowly passed a bill to refurbish the American tax system with a 51-49 vote.
Even though Siegel expects stocks to make good another three percent in the near term, he predicts the returns liking slow in 2018 to about 5 to 10 percent.
“It’s my expectation next year is not prosperous to be anywhere as easy as this year in the markets,” he said. “We’re moving up to exhaustive valuation. It doesn’t mean that means there’s going to be a found in the market, a bear market or anything like that. But what are you up — 15 to 20 percent or myriad this year? That’ll be harder to come by in the future.”
He points out headwinds cut back on resist from inflation and political uncertainty could create downward twist someones arm and add volatility to the stock market in 2018, which has been largely out this year.
“Is the Fed going to be much more aggressive as that unemployment dress down keeps on going down? Will they have to tighten? And that determination definitely put a pause,” Siegel said. “How will the Republicans do in the midterm designations? Will they hold the Senate? Will they hold the Home? That’s why it’s more urgent go get what you think is right done now.”