Wall Street sees bright side in 'healthy' tech sell-off

NEW YORK - Some of Wall Street's biggest players are viewing the stock market's recent tech-led sell-off as a bout of turbulence rather than the start of a longer slide - and they don't see it as a reason to run for the door.

Their optimism highlights how the Federal Reserve's pledge to keep interest rates at record lows and hopes of a breakthrough in a vaccine for Covid-19 have underpinned market gains this year, though many remain wary that the US presidential election and massive options bets on tech-related stocks could exacerbate market swings in the remaining months of 2020.

"I think of this rout not so much as a correction, but as a digestion," Kristina Hooper, Invesco's chief global market strategist, said in a recent note. Still, some believe more volatility is in store. A recent poll of investors from UBS Global Wealth Management showed 65 per cent viewed politics as their top concern, with the Nov 3 US presidential election just weeks away.

Mr Gayeski, of Skybridge, said he could see an opportunity to increase equity risk if there was a sharper drop, such as the Nasdaq falling 20 per cent or the S&P 500 declining 15 per cent from their respective highs and there were other supportive signs for the market such as the Fed's expanding its balance sheet further.

Source: News Formal (newsformal.com)

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