Scott Wapner (Host of 'Closing Bell') 00:00.230
let's ask tony pasquarello he is head of hedge fund client coverage of goldman sachs he's back with us at post nine it's good to see
Tony Pasquariello (Global Head of Hedge Fund Coverage) 00:06.750
you welcome back thanks
Scott Wapner (Host of 'Closing Bell') 00:07.550
scott nice to catch up with you before we get out of here for twenty twenty five you know there's something to be said for seeing a durable trend not making things too complicated and staying with the story for a considerable period of time i just described you because your
Scott Wapner (Host of 'Closing Bell') 00:24.270
point of view and your perspective on this market from the notes that i have read consistently and mentioned many on the air it changed and you are as you say responsibly bullish and that hasn't changed is that fair
Tony Pasquariello (Global Head of Hedge Fund Coverage) 00:35.990
i'll take it yeah i think you just set me up for a giant jinx maybe so but i'll but i'll i'll kindly take it i would say this i think i think the big dynamics in the game are still favorable for risk we think the fed will continue to provision more liquidity as we have this
Tony Pasquariello (Global Head of Hedge Fund Coverage) 00:51.590
cyclical upswing in the economy we've got S and P earnings up twelve percent next year following plus eleven percent this year and so i do think that interplay between the fed and the trajectory of the economy alongside this earnings growth is affirmative of a bull market and a
Tony Pasquariello (Global Head of Hedge Fund Coverage) 01:07.750
primary trend that's still
Scott Wapner (Host of 'Closing Bell') 01:08.990
higher been tempted i guess is the the word to use by the broadening story peeling you away from what's gotten you to the dance this this far and it doesn't sound to me from looking at your notes and your outlook that you expect anything different in the new year stay big don't
Scott Wapner (Host of 'Closing Bell') 01:27.550
get caught up on the idea that small caps are going to have some epiphany in the in the new year and have a tremendous year at the expense of what's going to happen with the large cap stocks there
Tony Pasquariello (Global Head of Hedge Fund Coverage) 01:38.120
still a believer US mega cap tech will do as well or better than any other part of the market i think some of the recent broader you've seen where some of the burden of leadership has shifted from the AI names and mega cap tech to large cap cycles i think that's a good thing and
Tony Pasquariello (Global Head of Hedge Fund Coverage) 01:56.150
it's consistent again consistent with our view that the economy is going to pick up a bit of speed so that's durable then but potentially i think that is durable so again two and a half percent GDP growth moving up from two percent this year so you kind of go from trend to a
Tony Pasquariello (Global Head of Hedge Fund Coverage) 02:07.830
little bit above trend and again what i think is so compelling about the view if it's correct is that SP earnings growth now in our view starts to embed some of the AI productivity being delivered to large cap corporate so i'd still rather make my bones with large cap than i
Tony Pasquariello (Global Head of Hedge Fund Coverage) 02:24.470
would with small cap what
Scott Wapner (Host of 'Closing Bell') 02:25.830
about the idea that OK we know about the large cap story know about all the capax and and everything else and then now it's time to really lean into the beneficiaries of all of the AI being put into effect so to speak from from all of these other companies and and that's where
Scott Wapner (Host of 'Closing Bell') 02:43.150
you're going to make your your real money in twenty six
Tony Pasquariello (Global Head of Hedge Fund Coverage) 02:45.710
i think that would be a very tidy outcome for the market and i do think again that is what we are baking into our equation when we say SP earnings will be up again double digits next year about one point five percentage points of that twelve is it attributable to the the full
Tony Pasquariello (Global Head of Hedge Fund Coverage) 03:00.990
index harvesting those productivity gains so i do you know it's in the doing of course but i think that is the nature of the bet we're making where we're so positive on growth
Scott Wapner (Host of 'Closing Bell') 03:09.230
they sound kind of skeptical to that though when you use words like very tidy in in in suggesting perhaps that maybe it's a little messier than that
Tony Pasquariello (Global Head of Hedge Fund Coverage) 03:17.750
yeah well i think this gets into some of the local narrative around tech which is the markets asking more demanding questions around valuation around financing around returns around the the the growth rate of capex and so i would say i'm still a believer you want to be open
Tony Pasquariello (Global Head of Hedge Fund Coverage) 03:34.870
minded about where all this leads but the public market as it does as it imposes that discipline is asking these questions whereas in the three years here to four scott there was just a total simplicity to it which is this is being funded out of free cash flow don't overthink it
Tony Pasquariello (Global Head of Hedge Fund Coverage) 03:49.630
nvidia stocks up tenfold in three years because its earnings are up tenfold in three years that is simple i think it's getting a little bit more complex as we move forward OK