Think of 2025 in 2 acts with different strategies for each half
Richard Bernstein Advisors CEO Rich Bernstein tells Julie Hyman and Josh Lipton on Market Domination that investors can think of the market in 2025 as a play with two acts. The strategist describes the economic landscape, saying, "We've got an existing healthy economy, we've got tariffs, we've got all this that it's likely that the [Federal Reserve] will go on hold [and] I think we should we should assume with some possibility as the year goes on, that maybe they have to start raising rates." When looking at how investors should position their portfolios, Bernstein says to think of the year as two acts rather than two halves, noting the "act one portfolio is going to look very different than an act two portfolio." "Act one, I think the economy is stronger than people think [which] argues for a cyclical tilt to a portfolio." He highlights that he's overweight on the energy (XLE) and industrial (XLI) sectors, as well as small and mid-cap equities. The second act of 2025 is uncertain because "if the Fed has to reverse course, act two becomes a more defensive portfolio," with the "textbook" plays being consumer staples, healthcare, and utilities. To watch more expert insights and analysis on the latest market action, check out more Market Domination here. This post was written by Naomi Buchanan.
