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From: Julius Wong5/5/2025 3:29:03 PM
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Cantor Fitzgerald issues stark warning on equities amid mounting economic risks

May 05, 2025 2:18 PM ET
By: Jason Capul, SA News Editor

Cantor Fitzgerald is maintaining a bearish stance on equities, cautioning that the recent market rebound which has been driven largely by investor positioning—is likely behind us. The firm foresees severe economic and corporate challenges unfolding over the next three to nine months as multiple headwinds take hold.

“We remain bearish equities and think the bounce that we thought was possible based on a number of factors is now behind us,” Cantor Fitzgerald said in a recent investor note.

Among the major concerns are inflationary pressures from tariffs, a decline in consumer and business spending following earlier demand surges, and growing uncertainty that’s already beginning to affect hiring and capital investment. Additionally, government job cuts are starting to surface in employment data, while persistent supply chain disruptions continue to weigh on economic output Cantor Fitzgerald expressed.

The global financial institution expects corporate earnings forecasts to keep declining and it sees elevated risk in the bond market, particularly with the anticipated impact of the upcoming reconciliation bill. The firm also warns that stock valuations have climbed back to unsustainable levels, especially given the current economic backdrop.

Crucially, the investment firm said that policymakers are unlikely to provide fiscal or monetary relief unless conditions deteriorate significantly.
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