The most important decision for investors right now is to determine their view on where they think the pandemic is going, Tom Lee, managing partner and head of research at Fundstrat, told Alison Kosik on CNN Business’ digital live show Markets Now.
“We’re at a crossroads because we had a surge [in infections] in June and July that showed that maybe some states opened too early and people got a little careless,” and this got investors concerned about the future, Lee said.
Once this surge ends, investors should focus on offensive stocks rather than playing defense. This would include investments in cyclical companies, including those in the industrials, consumer discretionary and energy sectors.
That said, a lot of uncertainty still remains going into the fall, over whether schools will repopen, the onset of the annual flu season and many (but not all) students returning to their colleges. “That’s going to keep people on edge,” Lee said.
Hopefully, however, the fall will also bring us closer to a vaccine to fight the disease, he added.