MW This strategist told investors to raise cash - in November. Now he sees a path to Dow 50,000 and $200 oil

By Barbara Kollmeyer

Yves Lamoureux flags the best asset to buy now

The makings of a stock-market rally are there, though good luck figuring out the exact driver. Monday's relatively calm finish on Wall Street, following two brutal sessions, offers at least some hope.

With that, here's a bullish call of the day from the president of market research firm Lamoureux & Co., Yves Lamoureux, who is back to talk about how the Dow Jones Industrial Average DJIA is headed for 50,000 - by 2027. And he's not talking a meltup, but "a hard grind" higher, as the index currently languishes under 40,000.

The Montreal-based Lamoureux told MarketWatch that once the index hits 50,000, he sees lots of "sideways" movement, with tougher progress because he expects the 10-year Treasury rates BX:TMUBMUSD10Y will hit 6% to 7%, possibly by 2028. In March 2022, he predicted 10-year rates would normalize at 4% by 2024 or 2025.

As for the tariff turmoil hitting stocks, Lamoureux expects upside surprises going forward, with negotiations that could mean a "different view," in six months or so. "As soon as the market can get a bit of clarity, that negotiations, something happens [that's] positive, the market's going to pick up and it's going to go back and continue higher."

Lamoureux was calling for the Dow to reach 40,000 in late 2020 - it finally happened in May 2024. "When I said 40,000 people were rolling their eyes," recalls the forecaster.

He warned clients last year that the market was too dismissive of tariffs:

And he told them to start raising cash in November, then again in December, because that would "give them options," such as money to buy stocks when markets started falling:

He was also preaching last year that the Fed had made a mistake by cutting interest rates into a rising stock market. "They are cutting and the market is zooming up so they're adding fuel to the fire. And we knew stocks were already expensive," he said.

The central bank has maybe one more 25 basis point cut that it can make, but no room for more in his opinion.

Lamoureux believes the latest selloff magnifies how investors need to improve in two crucial ways: raising cash more often and scaling in and out of markets --buying or selling a little bit at a time, to avoid scrambling, for example, at the bottom with no cash to spare.

"People have been taught to stay in the market. I think it's wrong. You need to build cash over time, when it gets too expensive and now it's very cheap," he said.

There are a lot of stocks that look cheap right now, but he's particularly keen on one group: oil producers. "I think they're going to be great for the next 10 years because oil...is going to see $200," he said. And he thinks that oil has probably bottomed around the current $60 level, dropping 15% so far this year, amid tariff-linked growth worries.

The SPDR S&P Oil & Gas Exploration & Production ETF XOP is down 19% this year, after falling 3% in 2023.

"Oil will go up because of resource depletion," he says. "It's the same phenomenon we've seen in the 1970s and the U.S., where regular oil was depleted. I'm saying shale gas, shale oil, shale production, I think that's peaking, so we will see a depletion," said Lamoureux. "And as soon as you have less production over demand, it's a commodity, it exaggerates prices, so I think we will see $200 [on oil]."

He is still a fan of AI and robotics, but says a lot of tech stocks are "still very expensive," making that a riskier play right now. "But definitely oil, the oil stocks are so cheap, definitely you nibble if you don't know what you are doing."

Read: 5 things that make this stock-market selloff truly unusual

The markets

U.S. stock futures (ES00) (YM00) (NQ00) are climbing, with Treasury yields BX:TMUBMUSD10Y BX:TMUBMUSD02Y slipping. Gold (GC00) is higher and the Nikkei 225 JP:NIK soared 6% on the opening of talks between the U.S. and Japan on trade.

   Key asset performance                                                Last       5d       1m       YTD      1y 
   S&P 500                                                              5062.25    -9.79%   -9.84%   -13.93%  -2.69% 
   Nasdaq Composite                                                     15,603.26  -9.80%   -10.68%  -19.20%  -4.00% 
   10-year Treasury                                                     4.165      -1.20    -12.00   -41.10   -20.40 
   Gold                                                                 3013.8     -4.55%   4.17%    14.19%   27.79% 
   Oil                                                                  61.55      -13.80%  -6.62%   -14.36%  -28.90% 
   Data: MarketWatch. Treasury yields change expressed in basis points 

The buzz

China could be considering a ban on Hollywood movies and U.S. agricultural goods to retaliate over U.S. tariffs.

Treasury Secretary Scott Bessent reportedly urged President Donald Trump to sketch out a tariff endgame and stem market mayhem.

Tesla $(TSLA)$ CEO and DOGE leader Elon Musk unsuccessfully appealed to Trump over a tariff reversal, a report said.

Read: How much Musk has lost as Tesla protests spread

UnitedHealth $(UNH)$, Humana $(HUM.UK)$ and other health-insurance stocks are surging after higher-than-expected Medicare Advantage payment rate increases for 2026 were announced.

Microchip giant Broadcom $(AVGO)$ announced a $10 billion stock buyback.

Levi stock $(LEVI)$ is climbing after forecast-beating results, and its CEO said tariffs will have "minimal" near-term impact.

The National Federation of Independent Business said its March small-business optimism index declined. San Francisco Fed President Mary Daly will speak at 8 a.m.

Best of the web

The stock market will go down 80% 'when this is over,' says bearish investor Mark Spitznagel.

The false tariff headline that sent stocks on a $2 trillion ride.

Beijing blinks as the yuan fix slips past the "line in the sand."

The chart

Bear markets come in three types - structural, cyclical and event-driven - all with different average declines, lengths and recovery times, say Goldman Sachs strategists. The current one is probably event-driven one, but could easily morph into a cyclical one, they say. Both see average falls of around 30%, but a cyclical bear market lasts longer and recovers slower.

Top tickers

These were the most active stock-market tickers on MarketWatch as of 6 a.m. Eastern:

   Ticker  Security name 
   NVDA    Nvidia 
   TSLA    Tesla 
   GME     GameStop 
   AAPL    Apple 
   TSM     Taiwan Semiconductor Manufacturing 
   AMZN    Amazon.com 
   PLTR    Palantir Technologies 
   AMD     Advanced Micro Devices 
   NIO     Nio 
   SMCI    Super Micro Computer 

Random reads

The dire wolf brought back from extinction? Not so fast.

Meet college basketball's next female prodigy.

Boris Johnson is not well liked in the ostrich crowd.

-Barbara Kollmeyer

This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.

(END) Dow Jones Newswires

April 08, 2025 06:54 ET (10:54 GMT)

Copyright (c) 2025 Dow Jones & Company, Inc.