Wren: Post-midterm volatility offers opportunity
SPY•Scott Wren of North Star Market Analysis says post-midterm market volatility may offer an opportunity, and he does not believe the election outcome warrants major asset-allocation changes. He expects easing inflation to support consumers and remains positive on technology, industrials and financials.
1. Volatility and the outlook
Scott Wren, market strategist at North Star Market Analysis, said last week's post-midterm turbulence had not significantly changed the broader investment outlook. He views the technology selloff, partly triggered by concerns that a new Congress could slow AI infrastructure projects, largely as a repricing of a crowded AI trade rather than a broad warning about the economy.
2. History and economic data
The S&P 500 remains only modestly below its record high, Wren said. He noted that since 1974, the Nasdaq has been higher one year after all but one midterm election cycle. October payroll growth was well above expectations, unemployment remains low, and Wren expects easing inflation to support consumer purchasing power.
3. Portfolio approach
Wren said investors should focus on portfolio construction rather than political headlines and does not believe the election outcome justifies major asset-allocation changes. He advises sticking with a disciplined plan and considering gradual additions to equity exposure; he remains positive on technology, industrials and financials.
