Strategas Research Partners’ Chris Verrone says the recent market pullback hasn’t damaged the foundations of the US equity rally and expects one more move higher before year-end.
In a new CNBC interview, the firm’s chief market strategist says the market’s core signals remain healthy.
“But when you look at kind of the big building blocks which have been tenet to our call, there really wasn’t a lot meaningfully wrong. Cyclicals were still better than defensives. Credit conditions were benign. Banks were largely still involved.”
He says those factors support maintaining a bullish stance through the remainder of the year, believing that the S&P 500 could still witness a big move to the upside before the year expires.
“So I think you have to give this market the benefit of any doubt here. I don’t know if yesterday or Friday was one and done, but 6,400, 6,450 is good support. I would still expect we make one more move here higher into year-end…
Yeah, so 7,000 is kind of what we’re still looking at here for year-end.”
Looking further ahead, he says 2026 could mark a more defensive phase as market leadership begins to rotate.
“I do wonder if 2026, you’re starting to set up for maybe a more defensive tone to take shape. We’ve already seen health care start to inflect here. I think the question is, does that bleed into the other defensive corners of the market?
So far, you’ve gotten nothing from staples, really nothing from REITs. And the move in utilities, I think, as we would all concede, is primarily power, or electricity-driven. So I think the big question for 2026 is, do you start to see some shift to the macro, which bleeds into leadership and gets you a more defensive profile in the months ahead?”
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