He’s the market bull who predicted the U.S. would be free of the coronavirus by Independence Day.
And now, Phil Orlando’s forecast may be closer to becoming a reality. As the U.S. goes to three available vaccines from two, President Joe Biden is assuring the country there will be enough supply to vaccinate every adult by the end of May.
The chief equity market strategist at Federated Hermes told CNBC’s “Trading Nation” the backdrop strengthens his call for the economy to normalize faster than consensus.
“Maybe we weren’t optimistic enough when I talked to you earlier in the year,” Orlando said on Tuesday. “These vaccines are working. The rollout is working, and if we can continue along this path, we will achieve herd immunity over the summer.”
On “Trading Nation” in January, Orlando predicted the economy would open months earlier than Wall Street expected. He acknowledges his forecast was “a little aggressive.” But, he sees evidence it’s being embraced.
“The Atlanta Fed, just as an example, has taken their first-quarter GDP estimate up to 10% on the basis of developments over the last couple of months,” said Orlando. “And, a lot of Wall Street economists have taken full-year GDP up to numbers north of 6%.”
Orlando, who oversees more than $619 billion in assets, believes economically sensitive stocks will outperform growth and big tech plays this year. He particularly likes domestic large-cap value, small caps and international plays, with an emphasis on emerging markets.
“Those three categories have outperformed domestic large-cap growth pretty significantly over the past six months,” he said. “There’s still plenty of catch-up to occur, and we think that trade will continue over the balance of the year. So, that’s where we’re putting new money right now.”