Bank of America: US stocks and gold are heading for a rare "four consecutive gains", material stocks may become the main theme of the next bull market.

Renowned strategist Michael Hartnett of Bank of America stated that U.S. stocks and gold are headed towards double-digit gains for the fourth consecutive year, a highly rare occurrence in history. Hartnett's team pointed out that the S&P 500 index is expected to achieve an annualized return of 20%, while gold is expected to see a 30% increase. They mentioned that such a long-term "big level" increase in the stock market has only been seen during the Second World War, the post-war peace years, and the bubble period from 1995 to 1999. The prolonged rise in gold occurred during the stagflation period of the 1970s. Rare consecutive gains in the U.S. stock market In recent years, the strong rise in U.S. stocks has been mainly driven by mega-cap stocks and technology stocks. The latest surge caused by the frenzy in AI capital spending has lifted U.S. stocks in an extremely narrow rebound driven by only a few stocks. Now, other sectors are also experiencing stronger gains. Hartnett and his team believe that due to the resilience of the U.S. economy, small-cap stocks, emerging markets, and commodities are collectively entering a "long-term bull market turning point." The market currently predicts a nominal growth rate of 5.5% for the U.S. economy this year, with profit growth expected to reach 20%. The Bank of America team predicts that material stocks will become the next strong growth point. Although this sector currently only accounts for 2% of the S&P 500 index, nearing a low point in 30 years, this situation is about to change. They mentioned that geopolitical competition for resources, increased military spending, the explosion of AI capital spending, and efforts to address housing shortages will make the material sector the "new market bull market theme."