The market rebound from March’s lows has been downright historic.
Yet the war-related headline risks remain, as do elevated equity valuations and the inflationary pressures of high oil prices.
Four of our expert analysts weighed in on the state of the market, whether the rally has further to go, and how they’re positioned going forward in a recent webinar, “4 Stocks to Help You Profit Amid Ongoing Market Turmoil.”
You watch the full webinar at the link above, but we’ve transcribed their big-picture takes below.
Mike Cintolo: “I’m increasingly bullish, still buying in stages.”
These are the parts of the cycle, you know, early in a new advance, I think, after many months of downside, that really can be super profitable. So, to me, I’m very optimistic, and a big part of it has to do with the setup.
So obviously, the last two and a half weeks have been great, no doubt about it. But even before that, you had the setup, which was number one, three months of grinding sideways action in the major indexes with cyclical stocks and defensive stocks doing pretty well, but even then, it was still choppy. And then you had a two-month decline that had a very in-your-face, obvious reason for it.
You had the Iran War. It wasn’t some esoteric like capex thing or Chinese interest rates. It was the Iran war, gas prices, the man, the woman on the street knew about it, which really got sentiment lower. Not that it was panic levels, but sentiment definitely caved in, whether you’re looking at the weekly stuff or some of the big-picture sentiment things that I do that really skidded down, like I said, over four or five months.
What was interesting is actually when the bomb started to drop a little before then, growth stocks, the risk-on stocks that you think would be highly valued, the ones that are going to get hit, started to hold up better than the market. And it was actually the defensive stocks, the toothpaste and toilet paper and band-aids that got hit along with other stuff, too. Not that things were going up, but things were holding in there pretty well.
And now, of course, you have things letting loose on the upside and leadership, too. To this point, it’s 12 days of the rally, 12 days doesn’t make a sustained uptrend. So things can go wrong, obviously, there’s no guarantees. But I have to say the power that we’ve seen here right off the lows after five-plus months of tedious to bad action is very encouraging.
In fact, I write about this in tomorrow’s Growth Investor issue, and I’ve mentioned it in the last week or two. But the S &P … was up seven days in a row. And during that time, I think it was up 8% … It was seven days in a row and more than 7%, which doesn’t sound that unusual, I guess, but it’s only happened nine other times since 1955. And the results looking out six to nine months are good, very good for the market.
But more important to me is kind of when it happened. And I’m not gonna go blow by blow, but basically it was major lows, like 2003, 2025, it was you know 1970 and ‘71 it was early ’87, it was a lot of things that really kicked off, you know, six- to 18-month advances.
Now the future isn’t yet written, so we’ll see how this thing plays out but it’s certainly a feather in the bull’s cap, you know what I mean, so overall I’m optimistic now.
Looking at the other side of things, I would say so far, the good news and bad news, the good news is we do have a decent amount of leadership. I would say the news to be aware of to this point is AI. And some of those stocks obviously are kind of later stage, not later stage, but it’s not the second inning.
These things are up a million percent over the past two years, not all of them, but some of them. So, if the rug gets pulled on some of these names, if Fidelity says, hey, let’s sell half our shares, things like that, that could cause issues for those stocks and the market. But I think overall, number one, if the rally goes further, which I think the odds favor, and I wanna be with the odds, things are going to broaden out.
… So simply put, I’m increasingly bullish, still buying in stages. I’m not saying we went from super defensive to super aggressive in two weeks. But I’m quite optimistic that we’re going to move higher here, and the leaders are gonna move higher with the occasional pothole, of course.
Tom Hutchinson: “A pre-post-war bounce.”
What a turnaround. I mean, just three weeks ago, things looked horrible. The S &P was down 7.7% in the month of March through March 30th. Since then, it’s up over 11% and yesterday closed at new highs.
Amazing.
And I think what this is, is sort of a post-war bounce before the end of the war, a pre-post-war bounce if you will. But I think a couple of things are going on here.
Yeah, there’s hope for peace talks, sure. And we’re not through it yet; there’ll probably be more troubling headlines, more skirmishes here and there, and I think that risk is keeping some of the financial and cyclical stocks at bay. But I think investors kind of sense that the disaster scenario is kind of out.
It’s not going to turn out to be a big regional conflict with $150, $200 barrel oil. And I think with that fear gone, I think there’s some relief. So that’s part of it.
It’s also the resurgence of AI. I mean, the AI trade is suddenly hot again. Two months ago, it was still floundering; it’s been floundering since late October.
Has anything materially changed in that industry in those two months? No. It’s just investors like it now; they didn’t like it then.
The bad AI story was so… February, but now they like it. And now the fears of, you know, there was concern that it hadn’t been widely adopted. They were tired of investing in infrastructure and the circular investments and companies that produce it, and it’s not widely used yet. It’s still a huge catalyst.
The consolidation was always going to end. It looks like it has. That’s a big deal for the market because … for the first three years of the bull market, AI had moved this bull market higher. After that, you saw participation and broadening out in a lot of other sectors. But AI is back, and that’s a big part of the market rebound before the end of the war.
Now, I’m not that bullish on sectors outside AI in the months ahead, because I think while we may have been on track for stronger growth, I think the war probably put that on hold. We’ll probably get higher oil prices for a while longer. All this increased inflation from oil has probably dissuaded the Fed from cutting rates, so there’s that problem.
But I still think AI is alive and well, and although it’s early, the rally could fade out, but so far, for this whole AI-driven market, I haven’t seen rallies show up for a couple of weeks in AI and then peter out. It usually lasts a while.
Carl Delfeld: “Diversify your portfolio to reduce volatility.”
The Cabot Explorer combines stock picks with ETFs. And I’ve been in ETFs for a long time. I was a pioneer in ETFs, and I think they’re a great product in terms of building a foundation for your portfolio. So think of it as a pyramid, your ETFs form the base.
…I think I have like eight or nine ETFs in the portfolio, and then layered on top of it or around it, however you want to think about it, are stock picks from all over the world. And I divide my stock picks into two categories, not value and growth, but what I call dominating stocks and disruptive stocks. Dominating stocks are more blue-chip, tend to be more conservative, hold a long time with good dividends.
And then disrupting stocks, disruptive stocks are more high-growth, a little bit more volatile, but definitely more upside as well. And then the third category is that we have quite a few U.S. stocks, but we also have a lot of international stocks sprinkled in, primarily from Europe, Asia, and Latin America.
And we’ve seen over the last couple years a movement towards international stocks. Number one, the dollar was a little bit more volatile. It’s weak, and then it’s strong. It’s been strong recently, but you want to hedge that a little bit. Second of all, valuations. A lot of times, international stocks are in the same markets, same performance, but maybe trading at half or two-thirds of what a comparable U.S. stock would trade, and that’s an opportunity. And then I think just a good idea to diversify your portfolio to reduce volatility and hopefully increase returns.
Clif Droke: “The outlook is bullish.”
So let me just briefly give you my take on the short-term market outlook. One of the things I like to see in a strong market, or a market that I believe has legs, is the financial sector needs to show strength. And it really has, even during the recent correction, the broker-dealers, the banks, regional banks, all of these typically vulnerable areas have held up well. And now some of them are looking exceptionally strong, particularly the broker-dealers.
I think that bodes well for this recovery that we’re seeing right now. Semiconductors is another vital area where I like to see strength and outperformance. Of course, that’s happening right now.
And also, to a lesser extent, I look at things like junk bonds and corporate bonds to measure how much liquidity is a problem or not. And I’m seeing that liquidity is fairly ample from that perspective.
So I tend to agree with my fellow analysts: The outlook is bullish, not just short, but intermediate-term, which I define as six to nine months down the line.
So that’s my look [at] the market. And I’ll say one more thing. This is the type of market I’m noticing a lot of traders, not just investors, but traders are focused on what might be construed as traditional turnaround stocks, stocks that are coming off of deep declines have really come into vogue right now as far as people looking to pick bottoms and take advantage of this rally.
They’re not just chasing momentum, they’re bottom picking. And that bodes well, I think, for the turnaround outlook.
For the full commentary, including the picks from our experts, you can watch the recording of our April 16, 2026, webinar.
And for a special rate on subscriptions to their advisories, take a look at Cabot’s Spring Sale here.
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