Veteran market strategist Jeff Saut sees a 'rocket ship' rally that sends stocks up nearly 30%

Published Mon, Jul 6 20208:14 AM EDTUpdated Mon, Jul 6 20208:38 AM EDT

Kevin Stankiewicz @in/kevinstankiewicz @kevin_stank

(This story is for CNBC Pro subscribers only.) Market strategist Jeff Saut told CNBC on Monday he sees major upside for the S & P 500 in the next 12 months, despite the coronavirus pandemic. "We may stall here for a while into the fall, ... but I think you're going to get a rocket ship coming in the fall," Saut said on "Squawk Box." "I think the S & P is going to trade out above 4,000. Saut's predication is well above even the most bullish 12-month estimates on Wall Street for the S & P 500, which hit its all-time closing high of 3,386 on Feb. 19. From Thursday's close of 3,130 , hitting 4,000 would represent a 27% increase for the broad index. Saut, chief investment strategist at Capital Wealth Planning , said the economic landscape is more fertile than many others believe. "Y'all live in New York City. Go to the restaurants. Restaurants are full. Restaurants in St. Petersburg are full. The economy is doing a lot better than most of the economists think," Saut said. "I think the economics are going to come on strong. I think earnings are going to do better than most people think." Saut also said people are "woefully under-invested" in equity markets, pointing to the nearly $5 trillion in money market funds . "So I think the markets are going up. I think they're going up a lot more than people think," the Wall Street veteran contended. Stocks fell into a bear market earlier this year, defined as at least 20% below a recent high, as uncertainty around the pandemic unsettled investors across the world. But since its late March virus-era low, the S & P 500 has risen more than 40%. However, intensifying outbreaks in states such as Texas and Florida have raised new questions about the pace and shape of the U.S. economic recovery, which has so far showed signs of strength . Saut, former chief investment strategist at Raymond James, said the recent developments around Covid-19 cases doesn't shake his bullish call for the S & P 500. He stressed that it is rooted in a belief that stocks remain in a "secular bull market." "There's not many of us that have been around 50 years to see what a secular bull market looks like," Saut said. "Secular markets tend to last 15 to 20 years, so depending on your starting point, whether it's October of '08 or March of '09, this thing ought to have another five, six, seven years left in it, and nobody believes it."

Jeff Saut, chief investment strategist at Capital Wealth Planning

Scott Mlyn | CNBC

(This story is for CNBC Pro subscribers only.)

Market strategist Jeff Saut told CNBC on Monday he sees major upside for the S&P 500 in the next 12 months, despite the coronavirus pandemic.

"We may stall here for a while into the fall, ... but I think you're going to get a rocket ship coming in the fall," Saut said on "Squawk Box." "I think the S&P is going to trade out above 4,000.

Veteran market strategist Jeff Saut sees a 'rocket ship' rally that sends stocks up nearly 30%

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