Jeremy Siegel says investors are viewing the U.S. bombings as ‘a success to neutralize Iran’
The market’s muted reaction to the U.S.’ attacks at Iranian sites showed investors view the action as “a success to neutralize Iran,” according to Jeremy Siegel, Wharton School professor of finance and Wisdom Tree chief economist. “I think most people agree they are farther away from producing a bomb than they were on Friday, and that’s positive for the markets…for eventual settlement in the Middle East,” Siegel said Monday on CNBC’s ” Squawk Box .” “So that’s sort of offsetting the fear.” Stock futures were little changed even after the United States entered Israel’s war against Iran over the weekend by striking three nuclear sites. President Donald Trump said air attacks “obliterated” those sites, and threatened more military action if the country didn’t make peace. “This is a success to neutralize Iran – that’s positive – against the risks of retaliation, which is negative,” Siegel said. “The positives and the potential negatives have sort of both gone up at the same time, and the middle has shrunk on that.” Traders are hopeful that Iran would not use an option that could risk a broader conflict and the removal of the regime there. Iran could target U.S. personnel in nearby bases or close the Strait of Hormuz , which would majorly disrupt global oil flows. .SPX YTD mountain S & P 500 Barring no big retaliation by Iran, Siegel said the stock market could see a new record high over the next few weeks. “I would not at all be surprised to see in the next couple of weeks, assuming no big action by Iran… new all time highs in the S & P 500 are certainly attainable over the next several weeks,” he said. The broader market hasn’t wavered since Israel’s initial assault on Iran this month. The S & P 500 is up about 1% in June, only about 3% below its all-time high from February.
