Sébastien Page, the Chief Investment Officer of T. Rowe Price, calls himself a reluctant bull. Page says he is optimistic about the U.S. economy, which he recognizes is not a controversial take. But he argues that there is a tyranny of high expectations surrounding markets, and they are quite simply expensive whether examining equities or credit spreads. With fundamentals and valuations concentrated in a select group of stocks, he expects market leadership to expand. 

One of the key themes in Page’s outlook is the potential for value stocks to gain prominence. While still slightly overweight stocks compared to bonds, he is strategically selling off portions of stocks and high-yield bonds in anticipation of a market broadening.

On whether the current market resembles a bubble, which some may compare to the speculative excess of the late 1990s and 2021 – when someone sold an NFT of a rock for more than a million dollars – Page argues that while speculation is evident, today’s high valuations are justified by stronger fundamentals, particularly within the tech sector. Adjusted for return on equity, the S&P 500’s valuation is less extreme than it appears, and with earnings growth projected at 15% in 2025, he sees room for continued gains. 

His broader perspective on money management suggests that investors may soon shift back to traditional valuation principles, marking a potential turning point where "buy low, sell high" regains prominence over momentum-driven strategies. With this in mind, his positioning reflects a bet on market broadening while maintaining caution against downside risks.

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