The stock market is likely to end its record streak of positive returns this year, according to Jeffrey Gundlach, the founder of DoubleLine Capital.
During his “Just Markets” webcast with investors on Tuesday, Gundlach forecast that the S&P 500 would end 2018 without a positive total return. Last year was the market’s ninth in a row, the longest on record.
But don’t count Gundlach among those forecasting a US recession any time soon. No economic indicator that typically sends a recession signal is flashing one right now. “This is a magic moment,” Gundlach said.
On the bond market, Gundlach said it was likely that the 10-year treasury yield would continue rising if it hit 2.63%. The benchmark bond’s yield spiked by 7 basis points to a 10-month high after the Bank of Japan trimmed its bond purchases.
Gundlach also weighed in on bitcoin, saying that the cryptocurrency had likely topped.
Here’s his full slide deck, courtesy of DoubleLine: