One of Wall Street's most experienced voices insists that the rally is far from over, and his outlook may impact not only stocks but also the crypto market.
The US stock market rally is far from over, according to Jeremy Siegel, Chief Economist at WisdomTree. In a recent interview, Siegel argued that stocks still have room to rise, dismissing fears that the summer market increase is about to cool.
'I believe this bull market is certainly still intact,' Siegel said in an interview with a TradFi media outlet.
Siegel highlighted that corporate earnings revisions remain positive and market breadth continues to strengthen.
While he does not expect a meteoric rise, he believes that a 5–10% increase over the next six months is quite possible. Monetary policy is at the core of his optimism.
Siegel from WisdomTree suggests a rise in the TradFi market — will crypto follow?
Siegel has consistently advocated for lower short-term interest rates. He argued that the Federal Reserve's benchmark rate should be at least 100 basis points below the 10-year Treasury yield.
In his view, the Fed funds rate should be in the 'low threes,' a level he believes the economy is heading towards.
This trajectory, he said, would be 'a great comfort for investors,' especially since small-cap stocks, represented by the Russell index, have shown strong sensitivity to easing expectations.
He added that the significant gains seen in both growth and value stocks last week highlight that this rally is broad, not timid.
A point of contention for investors has been the low trading volumes in the summer. However, Siegel minimized concerns, noting that low activity at the end of August is typical, as traders 'go to the beach.'
In his view, maintaining gains during seasonally weak periods, such as late August and early September, is historically a positive sign for the remainder of the year.
Still, Siegel acknowledged risks. The main one is the Federal Reserve itself. If Fed Chair Jerome Powell fails to meet expectations for rate cuts, Siegel warned that 'this ends the rally.'
The next Personal Consumption Expenditures (PCE) report is also a key point to watch. It is among the US economic signals of the week. This data may confirm that inflationary pressures are easing.
Siegel's outlook is relevant for crypto markets. Bitcoin and Ethereum, among other digital assets, often reflect Wall Street's risk appetite, with looser monetary policy historically driving capital inflows into stocks and crypto.
If Siegel's outlook holds true, interest rates fall, and the bull market extends, conditions may also support a new upward trend in the crypto market.
'...a potential Fed rate cut opens up retail capital, increasing demand for ETH,' said Kevin Rusher, founder of the RWA lending ecosystem, RAAC, to BeInCrypto.
As institutions increasingly treat Bitcoin as a risk asset, Wall Street's health remains closely tied to digital finance.
Price Performance of the S&P 500 (SPX) and Bitcoin (BTC). Source: TradingView
The article Wall Street remains optimistic, but the crypto market awaits a signal was first seen on BeInCrypto Brazil.
