Today’s the day – the day when we can officially say that inflation is dead and that the bull market is back on Wall Street.
Why? Because this morning’s consumer price index report showed that the Fed’s long, drawn-out fight with inflation is finally over.
May headline inflation clocked in at just 4%, down a whopping 90 basis points from April’s 4.9% rate. And every single aspect of inflation – food, energy, goods, and services – all fell. Not to mention that the 90-basis-point drop is one of the biggest declines on record.
Current estimates suggest the inflation rate will keep dropping at a record pace for the foreseeable future.
The Battle Against Inflation Is Over
The Cleveland Fed’s Nowcast model – which has consistently overestimated inflation over the past few months – sees CPI falling to 3.2% in June. Real-time Truflation data says inflation is currently running at 2.7%.
Assuming these estimates hold, then we could be back to 2% inflation – the Fed’s target rate – by July. In other words, we’re on track to reach that goal next month, with no further input from the Fed required.
The central bank has officially won the battle against inflation.
Now it can pause its rate-hike campaign. And we’re confident it’ll do just that tomorrow.
Following today’s inflation report, the futures market started pricing in 98% odds of a Fed pause tomorrow.
Not 80%, 90%, even 95%.
The futures market is saying there is a 98% chance the Fed pauses tomorrow. It is a virtual certainty at this point.
And Fed pauses kick off new bull markets.
Get Ready for the New Bull Market Boom
That’s how the bull market of the mid-1980s started – with a Fed pause in summer of 1984.
That’s how the bull market of late 1990s started – with a Fed pause in early 1995.
It’s the same story for the bull markets of the mid-2000s and the late 2010s.
Fed pauses start bull markets. And today’s inflation data all but confirmed that we’re getting a Fed pause tomorrow.
Folks, the bull is back on Wall Street.
And that means it is time to buy tech stocks.
You may have noticed that tech stocks have been soaring this year. That’s no mistake. Historically speaking, tech stocks tend to be the biggest winners when the Fed pauses a rate-hike campaign. That’s because they are long-duration assets whose valuations are the biggest beneficiaries of lower interest rates.
And over the past 50 years, nearly every Fed pause has sparked a 30%-plus surge in tech stocks over the following 12 months.
We don’t think this time will be different.
And the leaders of this tech rally will be AI stocks.
Artificial intelligence is sweeping across the globe like wildfire. It’s taking over huge portions of the economy and is automating workflows, making new drugs, arguing legal cases, driving cars, and more.
We have permanently and irreversibly entered the “Age of AI.”
And thanks to the Fed pause coming tomorrow, the “AI Boom” on Wall Street is about to kick into hyperdrive.
The Final Word
If you want to be a winner in that coming mega rally, you need to own the best AI stocks before tomorrow.
That’s why we’ve compiled a portfolio of the top AI stocks to buy today. We think stocks are about to soar, and AI stocks will likely lead that rally. We want you to own the best AI stocks to capitalize on this boom.
As part of this portfolio’s debut, we’ll also be demonstrating the real-world power of AI via a special presentation.
But reader beware: This presentation may be mind-blowing. And these stocks could produce mind-blowingly huge profits, too.
Watch that presentation now, before tomorrow’s Fed announcement.
On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.