In a recent interview with CNBC, Wharton professor Jeremy Siegel outlined the conditions he believes are required for the Dow to reach 30,000 by the end of this year.
The markets are facing two great uncertainties, according to Siegel: The first is whether the latest wave of coronavirus cases is going to subside, and the second is the November election. He said, “If we get continued progress and lower virus figures for the U.S. along with a resolution of the political uncertainty”—clarifying that he was referring more to the Republicans’ ability to maintain the Senate than he was about the presidential election—“I think that would be favorable for the market.” Siegel emphasized that the corporate tax cuts implemented by the Trump administration were a “major reason for a lot of the bull market since Trump was elected. If that’s going to be reversed, that’s a strong headwind for the market.”
Besides the issue of the Senate, Seigel said that in order for the Dow to reach 30,000 by the end of 2020, we must see the coronavirus subside and develop more therapeutics to treat it. In addition, he said, we will have to “gain confidence in the economy.”