On the heels of a Thanksgiving-timed “Turkey Rally,” PNC Asset Management CIO Amanda Agati says markets have reached a “crossroads” in determining the next catalysts to push them higher. Despite stocks rebounding off correction lows without further Fed tightening recently, she struggles to identify any "meaningful positives" and "meaningful negative" catalysts within the market, telling Yahoo Finance: "I think what's interesting at this point is what is the catalyst to kind of keep this market rally going?"

Agati believes this market uncertainty leaves investors in a holding pattern. Agati notes if the Fed maintains its current policy stance, markets may remain “directionless” to close 2023. With a recession still a potential risk, Agati advises investors to "stay close to long-term strategic targets" and let the new year shake out before making significant positioning changes.

For more expert insight and the latest market action, click here to watch this full episode of Yahoo Finance Live.

Video Transcript

RACHELLE AKUFFO: So start by setting the expectations. Given what drove markets so far this year, what is going to be what really sets the tone for the rest of the year?

AMANDA AGATI: Well, it's so nice to be with you. First off, thanks so much for having me. I think we're at a bit of a crossroads in terms of what happens next certainly for markets. It's been such a strong rally really all year long. I mean, we had a blip earlier in the fall where we had a bit of a correction, something that we had been anticipating.

But the market seemed to shrug it off and continue to forge a path higher here. And so I think what's interesting at this point is, what is the catalyst to kind of keep this market rally going? Certainly, the breather that we're seeing right now is well-deserved given the sprint that the market has had all year.

But with the Fed sitting on the sidelines and not necessarily taking any policy action, I think it's hard to really grab on to meaningful positive and also meaningful negative catalysts. And so I think what we're left with is a bit of a rangebound kind of choppy market from here through year end. So our view is we probably won't see a Santa rally materialize because we already got that turkey rally.

AKIKO FUJITA: So no Santa Claus rally. But it sounds like you don't see significant downside moving forward. Is this kind of a time for investors to maybe look ahead to what they want their mix to be in their portfolio going into 2024?

AMANDA AGATI: Yeah, I don't see a lot of downside at the moment. That's the challenge I mean, of course, the black swans, you know, you never see coming. So there could certainly be something that catalyzes a downdraft here.