Tony Roth, chief investment officer for Wilmington Trust Investment Advisors (MTB), spoke with Quartz for the latest installment of our “Smart Investing” video series.
Watch the interview above and check out the transcript, which has been lightly edited for length and clarity, below.
ANDY MILLS (AM): Big tech names such as Nvidia and Microsoft have led the market higher over the last couple of years. Do you see that continuing in 2025?
TONY ROTH (TR): Right now, we see a rotation trade into other areas of the market, but I think, longer term, we certainly expect to see those big names continue to grow earnings at a pretty rapid pace. One thing that’s important to keep in mind, though, is that it’s not a monolithic group. So there are some companies that are gonna do a lot better than others. Even within the Magnificent Seven, you’re probably going to see a rotation of some names out of that group and some names into that group.
One of the aspects of what’s happening in the market today that I think is really quite notable is that we’re at new, all-time highs as we sit here. And Nvidia (NVDA) is probably about 20% off of its all-time high. Given what we experienced in the first half of the year — where it seemed to be a market driven by a single stock — to be able to say that at this point is pretty remarkable. I think most participants might have felt that it would be hard to get to these levels on the S&P without leadership from Nvidia. And not only have we not had leadership, but it’s actually been going in another direction.
AM: Yeah. So AI is, I think, for most investors, a pretty obvious place where people have been investing. What other sectors are you guys looking at that people should try to get into this year?
TR: Financials have worked pretty well this year — not all equally, again, but if you look, for example, at the big money center banks, they’ve done pretty well. Some of them have done extraordinarily well, like JP Morgan, which is priced at pretty lofty levels now. But overall, right now with rates coming down, if we don’t…
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