The Federal Reserve's move has caused market turbulence, Wealth Bank: Don't chase highs, wait patiently for a pullback.

Scott Wren, Senior Global Market Strategist at Wells Fargo Investment Institute, said that retail investors should avoid chasing market rallies and instead position themselves to buy on pullbacks. "Do not chase highs, be prepared to enter at any time." Wren advised, emphasizing the importance of maintaining a clear long-term perspective during market volatility. Wren pointed out in an interview that the recent market fluctuations are a natural reaction to the Federal Reserve's shift from loose to tight monetary policy. He said, "Whenever the Fed makes such a policy shift, the market will always experience downward fluctuations, especially after a significant rise over the past three and a half years." Wren gave an optimistic economic forecast, expecting economic growth of around 2% to 2.5% for the next two years, with corporate profit growth expected to reach 25% this year and around 15% next year. One key assumption for these predictions is that the Persian Gulf shipping will soon return to normal. Wren admitted that if this expectation is not met, it will cause trouble for the market. In terms of sector allocation, Wells Fargo Investment Institute has gradually reduced exposure to the energy sector (XLE, AMLP, VDE, XOP) and related commodities. Wren predicted, "The best-performing sector so far this year has been energy, but I don't think it will be the same by year-end." He advised clients to reallocate funds elsewhere. The strategist is bullish on sectors with lower valuations and those related to the artificial intelligence theme, including industrials (XLI), utilities (XLU), materials (XLB), and financials (XLF). While Wells Fargo continues to recommend overweighting the technology sector (XLK) and sees AI as a more sustainable long-term trend, Wren said the team is actively seeking opportunities in the aforementioned areas. Finally, Wren reiterated his core advice for retail investors: maintain a clear judgment, do not be swayed by daily headlines, and act decisively when pullbacks occur. "Think ahead. If the economic outlook is positive and the market experiences a pullback, be prepared to get involved."