The S&P 500 could reach 7,500 by year-end, says Fundstrat's Tom Lee

Market Outlook - The market has experienced six consecutive months of gains, a rare occurrence since 1928, suggesting a strong November ahead with potential increases of 200 to 250 points on the S&P [4][5] - Despite a generally bearish sentiment, with an average sentiment of -11.5% this year, the market has risen by 17%, indicating a potential performance chase by fund managers as over 80% are underperforming their benchmarks [6][7] Inflation and Economic Indicators - Inflation is reportedly declining faster than expected, with true inflation dropping to below 2%, including housing costs, and shelter inflation at 0.16% month-over-month [8][9] - More than 54% of the CPI components are currently deflating, the highest percentage since the onset of COVID-19, suggesting a shift in inflationary pressures [9] Corporate Profitability - Companies are reportedly expanding profits and profit margins despite facing tariff impacts, indicating a potential productivity boom [11] - The market is trying to reconcile the effects of AI on job consumption with corporate profitability, suggesting a complex relationship between technology and economic growth [11][12] Federal Reserve and Market Reactions - The Federal Reserve's recent hawkish stance has caused unease in the market, particularly affecting sectors like homebuilders and regional banks [10] - There is speculation that the Fed may consider cuts if inflation stabilizes and job growth does not strengthen, which could lead to a dovish outlook [12] Private Markets and Fund Performance - Fund managers are experiencing one of their worst years in nearly 30 years, with many underperforming, which contrasts with the strong performance of public stocks [18][19] - Disappointment in private equity returns is contributing to a bearish sentiment among investors, despite the stock market's overall success [19] Cryptocurrency Insights - The cryptocurrency market is consolidating after significant liquidations, with fundamentals like Ethereum stablecoin volumes and application revenues at all-time highs [20][21] - Predictions suggest potential rallies in Bitcoin and Ethereum prices towards the end of the year, with targets of 15,200 for Bitcoin and 7,000 for Ethereum [21]