Speaker · Updated
Tom Lee: latest market views
Fundstrat Global Advisors
Summary
Tom Lee is co-founder and head of research at Fundstrat and CIO of Fundstrat Capital, a former J.P. Morgan chief equity strategist known as a market bull and an early Wall Street voice on Bitcoin, and chairman of Ethereum treasury company BitMine Immersion Technologies.
Chorus has 13 views from Tom Lee across 2 episodes on CNBC Power Lunch and CNBC Closing Bell since October 22, 2026.
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Newest first. Every quote is checked against the episode's transcript.
Stocks could fall until the November 3 midterms because institutions lack dip-buying conviction, though today is a good buying opportunity.
Tom Lee argues institutional investors do not have conviction to buy dips until after the midterms, so between now and November 3 it takes little for stocks to fall sharply. He cites that the equal-weight market is still rising, so there is plenty of money in the market. He also notes that many people are hesitant because of high-stakes midterm worries, such as a Republican Senate. He still sees today as a good buying opportunity, but expects the market to be bumpy until the midterms.
“reality is our institutional investors just don't have conviction until after midterm. So I think between now and November 3, it doesn't take a lot for stocks to get... To fall a lot because I just don't know if there's as much dip buying conviction till after November 3.”at 4:49
CNBC Power Lunch: Tech Sell-Off, AI Panic and Market Rotation: Power Lunch ·
The 10-year yield has fallen back to levels supportive of risk assets, backing the view that the selloff is a buying opportunity.
Tom Lee says history shows that days like this do not reliably reprice the market. He points to the 10-year Treasury yield, which has dropped back to levels he considers supportive of actual risk assets. He uses that backdrop to argue that today is a good buying opportunity.
“history has shown days like this are not about the market repricing with certainty. In fact, look at the ten year yield. That's kinda back to levels that are very supportive of actual risk assets.”at 10:01
CNBC Power Lunch: Tech Sell-Off, AI Panic and Market Rotation: Power Lunch ·
Market sentiment, positioning & volatility
Sell-offs are driven more by thin liquidity and forced hedge-fund de-risking than by crowded trades, which is a overused explanation.
Tom Lee says a liquidity vacuum explains many drops better than crowded trades, and calls 'crowded' a very overused word. He notes that many hedge funds have already lost a lot and could be forced to go flat, so indiscriminate selling creates price opportunity. He points out that Intel's 30% drop is a change in present value that reflects a shock and thin liquidity, not proof of crowding. He also says VIX above 21 signals some panic and indiscriminate selling, while history suggests such days are not certain repricings.
“I would say to me, I think that liquidity explains a lot of drops more than crowded trades. Think that's a very overused word.”at 12:14
CNBC Power Lunch: Tech Sell-Off, AI Panic and Market Rotation: Power Lunch ·
Investors are not overweight or overly bullish on AI; many are under-allocated to tech, which drives earnings.
Tom Lee argues that tech is the most important driver of earnings, so investors need to own it. He says he does not think people are overweight tech or that consensus is overly bullish on AI. His conversations with clients show mixed views on AI, and he thinks many investors are under-allocated. He uses this to reject the idea that stocks are falling because they are crowded.
“People need to own tech because that is probably the most important driver for earnings... I would say I don't think people are overweight and consensus overly bullish on AI.”at 12:29
CNBC Power Lunch: Tech Sell-Off, AI Panic and Market Rotation: Power Lunch ·
Debt markets are preventing a speculative AI boom; the correction is healthy, not a bubble popping.
Lee argues AI concerns are preventing a bubble because AI discoveries keep arriving, such as OpenAI solving a large batch of math problems, which shows this is not a late-cycle stage for AI discovery and that productivity gains are real. As long as advances continue, he says every dollar of AI capital raised is generating returns. He sees the tighter debt markets as a check on a runaway speculative boom, so he calls the correction very healthy.
“I think it's actually really healthy that the debt markets are sort of preventing a runaway speculative boom in AI.”at 36:33
AI infrastructure & data centers
AI's projected $30T spend is fundable; household interest income alone covers it.
Lee cites a recent report estimating AI will spend about $30 trillion over the next 25 years. He argues there is plenty of investment capital available to fund that because interest income from American households alone is about $7 trillion annually. So the funding need is large but not a binding constraint, which undercuts the capital-crunch concern.
“We did a report a few weeks ago showing that if AI is gonna spend 30,000,000,000,000 over the next twenty five years, one, there's actually plenty of investment dollars available because interest income from just American households annually is about 7,000,000,000,000.”at 37:01
AI infrastructure & data centers
AI is a bigger infrastructure build than mobile at similar dollar scale, so spending isn't excessive.
Tom compares the AI build to past infrastructure. The mobile network build was about $25 trillion and roadways about $25 trillion. He argues AI is arguably a more important infrastructure build than mobile and is about the same dollar scale, so he does not think too much money is being thrown at AI.
“I think AI is a more important infrastructure build arguably than mobile, and it's about the same dollar. So I don't think there's too much money being thrown at AI today.”at 37:28
Market sentiment, positioning & volatility
The AI tech sell-off is nearing its end because it has become a consensus short.
Tom says the AI and tech sell-off is near its end stages because the trade has become a consensus short. Crowded bearish positioning means the selling has largely been done and can reverse.
“I think we're near the end stages of the sell off because it's become a consensus short”at 37:41
Yields have backed off and the Fed is turning dovish, removing two key market headwinds.
Tom says yields, which had been worrying markets, have backed away. The Fed has gone from quite hawkish to potentially dovish. Rates that were touching fears of 6% are back below 5%. These were two headwinds, and with them easing the only remaining obstacles are closed debt markets and uncertainty about the war.
“And I think yields, which was really worrying markets, as you know, they've backed away. ... The Fed, quite hawkish. Now it's flipping potentially dovish.”at 37:50
Memory, Nvidia and Mag Seven chip stocks are bottoming; selling is driven by ease of shorting.
Tom argues the memory bottlenecks, Nvidia and the Magnificent Seven are being sold because they are now easy to short, not because of broken fundamentals. He thinks they are bottoming, and says the fundamentals have held in, which he calls coiled strength. He acknowledges people worry about the credit side.
“They're being sold because it is easy to short them now. ... But I think they're bottoming”at 38:24
Financials have lagged even as rates fall, creating a lot of opportunity.
Tom notes financials have not been rallying even though rates are coming down. He concludes there is a lot of opportunity there. The support is brief, so this is a thin view.
“And as you know, financials haven't been rallying, but rates are coming down. So I think there's a lot of opportunity.”at 38:34
AI setup resembles Cisco's 1997 drawdown, and the AI trade is still very early.
Tom compares AI to 1997. Three years after the public Internet launched, Cisco, then the biggest stock, had a 50% drawdown, partly because Greenspan warned of irrational exuberance and hinted at preemptive hikes. Cisco fell to 5 and was 18 a year later. He says the setup is similar and ChatGPT is just passing its third anniversary, so the AI trade is very early. He acknowledges many people made money and profit-taking is underway.
“I think the setup is similar. You know, [ChatGPT] is basically crossing its third anniversary. I think we're so early in this AI trade”at 39:42
Broad market should rally strongly after the midterms, after a risk-off window to buy.
Tom expects the next couple of weeks to be uncertain heading into the midterms. He sees this risk-off window, with tech touching support, as a time to buy. He expects the market to rally broadly and very strongly after the midterms.
“I think this is the window where investors can buy things because the market is going generally risk off. But I think post midterms, market's gonna rally broadly and very strongly.”at 40:35
Shows
- CNBC Power Lunch · 1 episode
- CNBC Closing Bell · 1 episode
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