We're in a 'buffalo' market, Bank of America says. Here's what that means for investors

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Investors can expect more volatility in the runup to the November election. But other factors will also influence their returns for the year.

Today's market is more like a buffalo than a bull, Bank of America says, which means it can be expected to roam.Here's what investors can expect through the rest of 2024, and the risk they should be watching for now.Thursday amid a selloff in technology stocks. Experts say those stock moves and shuffling sectors are common during a bull market.— which is still in the bull family. But unlike the bull market, it may get tired after a strong runup.

The firm's outlook sees markets finishing higher this year, based on factors including earnings, the investment cycle, financial conditions, interest rates and generative artificial intelligence. Bank of America therefore expects U.S. equities to end the year higher than where they are today, she said.To best forecast how investments will fare under the next presidential administration, it's wise to pay more attention to policy than politics, McGregor said. The policies that are actually put into effect will have a bigger impact on sectors, industries and companies than which party is elected to power.

"Ultimately, I think this really comes back to earnings," McGregor said. "That's what I really see as the catalyst for the next rotation of the market, more so than the election."Likewise, McGregor said she has started to warn clients that the current higher returns on cash will not always be available and sitting out the market gains carries risks.

 

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