Market rally doesn't need a Fed rate cut in December, says Bank of America's Chris Hyzy

Yields cautious down , medium term, interviewee explicit

explicit

NDX up , medium term, interviewee implicit

implicit

RUT up

Oil

Metals

USD

Bank of America 8.5
Investment Bank $3040.00B
Chris Hyzy 9.0

Market rally doesn't need a Fed rate cut in December, says Bank of America's Chris Hyzy

ndx

Remains overweight equities, sees strong profit cycle through 2026, digital infrastructure growth beyond just AI, and advises using short-term weakness as buying opportunity

yields

We certainly do because the short end coming down looking through over the next 12 months Expects yield curve steepening with short-term rates declining while long end may rise, creating uncertainty that takes froth out of equity markets

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no reliable edge (random outcomes)

10/29/2025 1:10:31 PM	short term cautious down	5 days later	-0.10%	+0.05%
10/15/2025 6:53:52 PM	medium term cautious down	20 days later	+4.55%	-2.28%
9/18/2025 10:17:17 AM	short term cautious down	5 days later	+0.19%	-0.10%
9/17/2025 6:36:22 PM	short term cautious up	5 days later	+0.39%	+0.19%
9/17/2025 4:38:45 PM	medium term cautious down	20 days later	+0.61%	-0.30%
9/5/2025 10:40:41 PM	medium term cautious down	21 days later	+2.35%	-1.17%
9/3/2025 5:31:38 PM	medium term sharp down	20 days later	-0.69%	+1.04%
8/26/2025 11:54:24 PM	short term cautious down	6 days later	+0.92%	-0.46%
8/14/2025 9:14:07 PM	short term cautious down	5 days later	-0.74%	+0.37%

Show all 9 yields results

Do you think that the markets really need the Fed to cut to keep steaming along?

CNBC Anchor
Chris Hyzy

Right now in the short term, the enthusiasm taking off and backing away from the potential cut everyone expected in December is putting weakness on the market, but does it really need it? It really doesn't

The market has been factoring in a much better profit cycle looking all the way through 2026, having easier financial conditions and more liquidity will help in the short term
Chris Hyzy

Pausing or having a cut in December is more of a very near-term small hurdle
You think that there's a kind of flywheel that is keeping equities humming along

CNBC Anchor
Chris Hyzy

Three specific areas driving the flywheel: digital infrastructure beyond just AI, boomer spending in travel/leisure/entertainment, and profit momentum

Digital infrastructure has more room to go than just one vertical, boomer spending masks lower-end weakness but aggregate consumer spending remains healthy
When we're looking at the yields, are you expecting to see more steepening?

CNBC Anchor
Chris Hyzy

We certainly do because the short end coming down looking through over the next 12 months

The back end going up takes some euphoria and froth out of the equity market and adds uncertainty, would be taking advantage of this weakness today
What's your best advice right now about where we're heading into the last month of the year and how we start 2026?

Mentions AI bubble skepticism from Michael Burry and Jim Cramer about debt financing for data centers

CNBC Anchor
Chris Hyzy

We're going to stay overweight equities and use weakness in markets like today when there's no real fundamental news out there

Consumer data and spending still around normal in aggregate, liquidity should pick up again in December, profit momentum and margins critical for small caps gathering better momentum into 2026
Chris Hyzy

We're not at bubble stage for AI yet - bubbles happen when debt financing comes in at later stage of buildout and can't substantiate cash flows

Should be on guard but not at that level yet in total spending or debt financing
What's your sense of international investments versus US?

Notes European stocks hitting record highs but now off slightly

CNBC Anchor
Chris Hyzy

We're neutral across the board on international investments, closed out underweight earlier this year

Growth slowing in Europe and UK, Japan picking back up, emerging markets heavy in real assets with exposure to tech/financials/consumer discretionary like US

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