The Federal Reserve’s inflation progress is expected to stall in 2025, according to Robinhood’s new year outlook. Robinhood Financial’s head of investment strategy Stephanie Guild joins Seana Smith and Madison Mills on Catalysts to discuss her expectations for the market (^DJI,^GSPC, ^IXIC).
With rates expected to stay higher for longer than initially anticipated, “actually keeps a lot of the market in check,” Guild says.
She explains, “If you have super low rates, it means that there is not much risk to borrowing, and it means that the return that you might put that money in doesn’t have to be that high. And so I think it actually keeps a good economy going better if rates are sort of a little bit elevated.”
“It means that cash will still earn a yield … [and] you can still keep money on the side and have a decent return on it, but I also think that it means that there is still going to be opportunities,” she says.
The strategist notes, “This is a stock pickers market, and I’ve been thinking that for a while.” For example, Guild highlights that Adobe’s (ADBE) stock is under pressure after its earnings report, which could raise concerns about the tech sector, but Broadcom’s (AVGO) results, which were released the following day, sent its stock higher.
She explains the market has shifted from “interest stock correlations were relatively high,” meaning “any particular stock would just sort of move with the market,” to it being company-specific.
To watch more expert insights and analysis on the latest market action, check out more Catalysts here.
This post was written by Naomi Buchanan.
