Barron's Streetwise Bull Market Health Check. Plus, Philip Morris CEO Jacek Olczak
16 snips
Sep 26, 2025 Scott Wren, a senior global market strategist at Wells Fargo, shares insights on the attractive S&P 500 outlook and the impact of AI on stock valuations. He counters concerns about an AI bubble by comparing today's tech fundamentals to the dot-com era. Wren emphasizes sectors like tech, industrials, and utilities as promising investments. Meanwhile, Jacek Olczak, CEO of Philip Morris, discusses the company's shift to smoke-free products, highlighting their higher margins and potential for growth, reshaping public perception in the process.
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Quality Tech vs. Dot‑Com Hype
- The current AI-driven rally rests on a few mega-cap techs with real revenues and cash flows, unlike dot-com era speculation.
- Valuations are high (~25x) but supported by outsized earnings growth tied to AI CapEx.
AI Spending Broadly Benefits Other Sectors
- AI CapEx is driving most S&P growth and is expected to keep growing, benefiting related sectors beyond the core AI firms.
- Industrials and utilities can profit from building data centers and upgrading grids as AI demand rises.
Favor Financials For Cyclical Tailwinds
- Consider overweighting financials to benefit from a steeper yield curve, deregulation, and increased M&A and loan demand.
- Financials can profit as deposit costs remain lower than lending rates in a steeper curve environment.
