Fundstrat
Fundstrat’s Tom Lee: Fed Cuts Could Spark Big Moves in Stocks & Crypto
9/15/2025, 8:24:13 PM
Economic Summary
- Federal Reserve cuts are central to the next leg of the rally: easing would boost liquidity, restore CEO confidence, help ISM rise above 50, lower mortgage rates, and broaden the cyclical recovery.
- AI and the MAG-7 cohort remain primary drivers of earnings surprise and innovation, suggesting the tech-dominant rally still has runway and is not yet conclusively late-cycle.
- Monetary-liquidity sensitivity means global central bank easing could materially lift crypto assets like Bitcoin (BTC) and Ethereum (ETH), with seasonality pointing to potential strong moves in the near term.
- Interest-rate sensitive areas — homebuilders, small caps, and financials (e.g., GS, JPM) — would benefit from lower rates and represent the cyclical broadening trade beyond tech.
Bullish
- AI-driven earnings growth should extend the tech-led rally (benefiting NASDAQ100).
- Crypto (BTC, ETH) could surge with global central bank easing and seasonal strength.
- Banks embracing blockchain/AI could re-rate like tech, boosting GS and JPM.
- Tokenization (Robinhood/HOOD on Ethereum) enables 24/7 trading and greater transparency.
Bearish
- Some parts of the MAG-7 trade are later-cycle and may be vulnerable to rotation.
- The market is dependent on Fed cuts; failure to ease could keep business confidence subdued.
- Labor market slowing and a prolonged ISM below 50 reflect continued business caution and downside risk.
Bullish tickers
NASDAQ100BTCETHGSJPMHOOD
Bearish tickers
NASDAQ100
NASDAQ100
Bullish
Primary beneficiary of Fed cuts; AI and MAG-7 likely to see significant liftoff and broaden the rally.
Bearish
Some parts of the MAG-7 trade are later-cycle and vulnerable to rotation if Fed easing doesn't materialize.
BTC
Bullish
Monetary liquidity sensitivity and global easing could drive a large, seasonally strong move higher.
Bearish
High volatility and regulatory uncertainty remain risks for Bitcoin despite liquidity-driven upside.
ETH
Bullish
Wall Street is building tokenized securities on Ethereum (and layer-2s), making ETH central to institutional infrastructure.
Bearish
Scalability, regulatory, or adoption hurdles could slow Ethereum's role in tokenization.
GS
Bullish
As banks streamline with blockchain and AI, GS could re-rate more like a technology company.
Bearish
Execution risk in transitioning to blockchain/AI and late-cycle banking risks could pressure shares.
JPM
Bullish
JPM can benefit from AI/blockchain-driven efficiency gains and potential re-rating alongside tech peers.
Bearish
Transition and execution challenges in adopting new infrastructure could create near-term headwinds.
HOOD
Bullish
Leading retail tokenization efforts enable 24/7 trading and transparency, built on Ethereum layer-2 solutions.
Bearish
Tokenizing securities raises operational, custody, and regulatory risks for Robinhood.
People mentioned
Tom Lee