Third Point's Dan Loeb, who nearly doubled the S&P 500's return over the last two decades and manages $18 billion, just put out the most bullish note on the stock market we've seen in a long time from a top hedge fund manager.
"We believe the US has room to lead versus the rest of the world from here and while we have increased exposure to Europe overall this year … the majority of our portfolio remains in US equities," Loeb wrote in an investor letter obtained by CNBC. "Supported by strong global GDP growth and the prospect for tax reform, S&P 500 earnings prospects are solid."
Loeb noted that economic growth is improving due to the weak U.S. dollar and looser-than-expected monetary policy from the Federal Reserve. As a result, he is especially optimistic on the domestic stock market.
"We were constructive on markets coming into 2017 based in part on expectations that we would see more favorable conditions for businesses via deregulation and tax reform," he wrote. "Deregulation is occurring quickly and although tax reform remains in the works, we expect that markets will continue to move higher, driven by strong consumer and business confidence combined with synchronized global growth."