Tom Lee: The stock market bottom is in

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Fundstrat 6.5
Market Research Firm
Tom Lee 9.0

Tom Lee: The stock market bottom is in

ndx

Stocks are now in the process to go back to their all-time highs. Believes the bottom is in due to war de-escalation and prior market repositioning. Leadership from Mag7/software supports NDX direction.

1/21/2026 11:11:31 PM	medium term cautious down	20 days later	-1.24%	+0.62%
11/14/2025 11:23:51 PM	medium term cautious up	21 days later	+3.34%	+1.67%
11/10/2025 10:53:49 PM	short term up	6 days later	-2.87%	-2.87%
10/6/2025 2:52:07 PM	medium term up	20 days later	+3.95%	+3.95%
9/15/2025 11:21:47 PM	medium term up	20 days later	+2.90%	+2.90%
8/22/2025 6:28:53 PM	short term up	8 days later	-0.83%	-0.83%
8/13/2025 3:51:26 PM	short term up	5 days later	-1.88%	-1.88%
8/4/2025 10:55:29 PM	short term sharp up	6 days later	+2.21%	+3.31%
8/4/2025 4:19:52 PM	short term up	6 days later	+2.21%	+2.21%

Show all ndx results

wti

As oil flattens or cools... Agrees with host's prompt that energy/oil (which went up for war reasons) will now go down. Expects a cooling/flattening of oil prices.

Introduces Tom Lee and asks for his market outlook.

Scott
Tom Lee

I think the bottom's in. Stocks are now in the process to go back to their all-time highs, maybe to 7300.

Last week the war was getting worse and oil was going up, but stocks weren't going down. That's a good precondition. Today we have the rate of change that the war is de-escalating.
Asks if the cause of the bear market matters for the outlook, or if Lee is confident the market will rebuild after the negative reaction.

Scott
Tom Lee

Things possibly changed because this war pulled forward a lot of repositioning. The summer lull won't be as deep because we've already fallen 8%.

People have gone flat or raised cash for defensive positioning. 70% of the S&P has already been through a rolling bear market in energy, financials, Mag7, and software.
Asks what the makeup of the market looks like in a move back to record highs.

Scott
Tom Lee

Leadership has been revealed in the last six weeks: crypto (Ethereum), energy stocks, Mag7, software, financials. That's the group leading us up.
Asks if energy, which went up for obvious reasons, is now going to go down for obvious reasons.

Scott
Tom Lee

Yes. As oil flattens or cools, those names (Mag7, Ethereum, software) are going to get a bid. They've gotten already cheap.

The negative correlation to oil was the highest in almost a decade for the Mag7, Ethereum, and software.
Asks if the broadening/value trade is mostly over given questions about an economic slowdown, even with elevated oil.

Scott
Tom Lee

There's still a shock rippling through the economy which we maybe haven't felt quite yet. I think there's an inflation shock still coming.
Tom Lee

The broadening is taking place. More investors will buy US stocks because the US has proven its resilience and makes more money in a war.
Asks if an incoming inflation shock will negatively impact the broadening trade.

Scott
Tom Lee

Yeah, I think it is out there. We just don't know the amplitude. But there should be some inflation shock coming.

It's like a wave. We don't know if it will be diminished when it hits shore or if people are bracing for it.
States the Fed seems to be leaning towards doing nothing, and if they believe Lee's view, they'll remain on hold potentially longer.

Scott
Tom Lee

It depends on if consumers and corporates view this as temporary or a change in inflation. Surveys and incoming reports will matter.

The Fed fund futures show the market's shifting back towards cuts.

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