March Blog 2025
The U.S. stock market benefited from record earnings from last quarter pushing the S&P 500 (5675) to new highs (6147) on February 19th, 2025. For the last four years the U.S. markets has had consistent policies that allowed the stock market to flourish. A strong GDP and low unemployment is no longer a given, based on the uncertainty that new U.S. government policies have created. Last year our country had one of the highest GDP’s in decades. Continuation of these policies could have been favorable for investors. Unfortunately, the foundation for the stock market is no longer stable. Consumer confidence, GDP numbers, and unemployment claims have reacted significantly over the last month to the new political direction.
Based on the uncertainty created by these economic policies, we expect the S&P 500 could fall at least 25% to 50%, with our initial downside target of 4610. Until the U.S. equity markets suffer these types of losses, we do not expect any change to the new extreme policies to take place.
The war on democracy for U.S. stocks is over. Over the last 10 years we have seen a struggle for democracy, which no longer exists in our eyes in S&P 500. Last year is a great example of how the top 10 companies dominated returns within the index. Most other companies seem to have become less important over the last 10 years. Large monopolies do not support a free market. U. S. politics and businesses are now more likely to continue this trend. What we recognize is the rules are changing each day, so it is harder for us to predict
future market returns given the market uncertainty that seems to be based on lies. Markets historically do not like uncertainty. The foundation of trust is built on honesty and at some point, deception and lies will destroy all trust.
The S&P 500 has already broken our initial support level of 5892 and our intermediate support level is 5652. We are raising our primary support to 5402 which we believe will be a normal technical correction. We now consider our Stratos base camp support of 5191 as a possible re-entry point. Our Line in the Sand is 4972 and if broken, would confirm to us a new bear market. Stratos thinks investing in long-term bonds is a mistake. We forecast interest rates will go up for the next 10 years or even longer. Any interest rate declines, even due to a recession, will be short term. We now consider investing in bonds as high risk and may not meet your income needs nor protect you from inflation. The question is how soon will it be, before we see double-digit interest rates?
We continue to recommend alternative investments such as gold, silver, and commodities to move higher. Our initial target is gold ($3,000) is $3,400, which we predicted when gold prices were around $1700 and $47 for silver ($32). We also recommend exposure to Master Limited Partnerships and high equity income securities to generate income with potential growth. With oil ($69) undervalued, Stratos anticipates energy prices will move higher in 2025 testing our initial resistance level of $96. Stratos remains bearish on U.S. stocks for the short term. Strong earnings and low unemployment may not enough to support a positive U.S. stocks market for 2025.
Contact Info:
Address: 210 N Stanton St Ste 3 El Paso, TX
Phone: (915) 312-6117
E-Mail: Bernard@stratosoneseven.com
Stratos Investments is a DBA of OneSeven, an investment adviser in Ohio. OneSeven is registered with the Securities and Exchange Commission (“SEC”). Registration of an investment adviser does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. OneSeven only transacts business in states in which it is properly registered or is excluded or exempted from registration. A copy of OneSeven’s current written disclosure brochure filed with the SEC, which discusses OneSeven’s business practices, services, and fees, is available through the SEC’s website at: www.adviserinfo.sec.gov. All titles listed for Individuals associated with Stratos Investments represent the individual’s role with Stratos Investments.
Please note, the information provided in this presentation is for informational purposes only and investors should determine for themselves whether a particular service or product is suitable for their investment needs. Please refer to the disclosure and offering documents for further information concerning specific products or services. Investments in securities entail risk and are not suitable for all investors. Past performance is not a guarantee of future returns. This is not a recommendation nor an offer to sell (or solicitation of an offer to buy) securities in the United States or in any other jurisdiction.
