Tom Lee: These factors point to higher stocks

Longtime bull Tom Lee said Friday it's been tough lately to be positive on stocks, but too many investors may have have tilted to the bearish camp.

Lee, co-founder of boutique equity research firm Fundstrat Global Advisors, did acknowledge that "investor confidence has been shattered," which could pressure the market in the near term. But he views the 2016 turmoil as a growth scare, not a recession.

With only two days of trading left in the month, stocks were on track for a second-straight week of gains and a positive month — quite a different story from January's dismal start of 2016. In Thursday's powerful rally, the Dow Jones industrial average joined the S&P 500 in pulling out of correction territory.

Lee played down the concern about the possibility of a global recession, saying market internals like transport and small-cap stocks are not pointing to a recession. "If we're actually seeing worsening economic conditions, these should be in a death spiral," he said. But he noted that these groups have actually been doing better.

The environment for the consumer, whose spending makes up two-thirds of the economy, is good, said Lee, a former chief equity strategist at JPMorgan.

St. Louis Fed President Jim Bullard told "Squawk Box" on Thursday he also was not too concerned about a world recession, despite a Citigroup prediction that the odds of a global downturn are rising.

In a research note Wednesday, Citigroup analysts defined a global recession as growth below 2 percent, differing from the usual requirement of gross domestic product falling for two consecutive quarters.

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