There's short-term bullishness in the market that's going to continue, says Aperture's Peter Kraus
Speakers
Peter Kraus
— Chair and CEO, Aperture Investors
Summary
Peter Kraus of Aperture Investors says the near-term market has no clear downside catalyst and short-term bullishness can continue, supported by declining inflation, Fed liquidity, a steepening yield curve, and early cyclical strength. He remains invested in broad markets and favors cyclicals, small caps, and bombed-out consumer stocks, while viewing banks as expensive after a big run. On AI, he expects heavy capex over the next 18-24 months into real infrastructure, and he does not expect an immediate broad AI-driven jobs shock.
- Peter Kraus sees no immediate catalyst for a market selloff and expects short-term bullishness to continue.
- He cites declining inflation, Fed liquidity, rising but non-dramatic unemployment, and a steepening yield curve as supportive.
- Tariffs are viewed as neutral-to-positive near term, with potential inflation risk longer term if removed.
- He favors broad equities, cyclicals, small caps, and bombed-out consumer stocks.
- He calls banks expensive after a huge run, though still trending.
- He expects AI capex to rise over the next 18-24 months into real infrastructure assets.
- He downplays the risk of AI causing a sudden, broad employment destabilization.
Ideas
Short-term bullishness; broad markets investable.
He sees no near-term catalyst for the market to go down and says the market is supported by declining inflation, a Fed providing liquidity, unemployment rising but not dramatically, early cyclicals behaving well, and a yield curve beginning to steepen. He expects short-term bullishness to continue and still considers broad markets investable.
AI capex supports real infrastructure assets.
AI should attract significant capital expenditure over at least the next 18 months to two years. The spending is going into real infrastructure assets such as power plants and electrical systems, which have real value and can drive growth.
Cyclicals are reasonably attractive investments.
Cyclicals are reasonably attractive places to invest, supported by early cyclical stocks already behaving well and the yield curve beginning to steepen.
Banks look expensive after huge run.
Banks look a bit expensive to him after a huge run. They may continue for now, but he is cautious about how far the move can go.
Bullish on small caps despite neglect.
He has been a bull on small caps, which are disliked by many investors, and they have had a very good couple of days; he wants to see whether the move continues.
Consumer stocks bombed out, an opportunity.
Consumer stocks are bombed out, which he views as an opportunity as the consumer-related area appears overly depressed.
