The S&amp;P 500 index is less than 1% away from its historical high, but Wall Street is still full of bullish sentiment.
Currently, inflation is falling towards the Federal Reserve's long-term target, and a rate cut seems imminent, with corporate profits, consumers, and the broader economy all demonstrating resilience. However, there are also many risks, with some economists concerned about a cooling labor market and the potential for an economic recession.
However, these economists have been consistently wrong in predicting factors that could drag down the stock market and the economy.
To assess what investors are worried about when the stock market hits new highs, foreign media interviewed experts who have been consistently correct in their predictions over the past few years, including three bullish strategists. Here are their views.
<h2>Brian Belski from BMO</h2>
For Brian Belski, Chief Investment Strategist at BMO, his biggest concern is that he is betting on fewer bears in the market, as overwhelming bearish sentiment just a few months ago has now shifted to bullish.
Belski said, &#34;When there are many bears in the market, or those who have been reluctant to join the bull market suddenly change their forecasts and start chasing the rise, this is really typical. I think there are too many bulls now.&#34;
Although it sounds counterintuitive, Belski is worried that the stock market will rise significantly from now on, rather than fall, as this would create an ideal environment for a significant pullback in the future.
Belski said, &#34;I don't want to see a super surge now. The faster the market rises now, the more worried I am.&#34;
With many investors feeling optimistic about stocks, if there is a significantly worse-than-expected macroeconomic surprise, the market is more likely to see selling. Belski said, &#34;From an emotional perspective, we are just a step away from a pullback.&#34;
Regarding possible macro data, Belski believes that unexpected spikes in inflation, poor job reports, or Nvidia's financial results significantly below expectations are all possible.
<h2>Eric Wallerstein from Yardeni Research</h2>
Eric Wallerstein, Chief Market Strategist at Yardeni Research, stated that there are two tail risks that could prevent the stock market from rising, and investors should take note. The first is the escalation of geopolitical tensions.
Wallerstein said, &#34;Overall, geopolitical tensions are increasing.&#34;
In addition, populist movements and nationalism are gaining popularity in countries around the world, which is detrimental to the globalized economy, Wallerstein said. &#34;This will lead to a world with more friction and less growth.&#34;
The second risk is similar to Belski's concern, that the stock market could experience a bubble similar to the 1990s.
Wallerstein said, &#34;My idea is that valuations continue to expand, and the market may reach a bubble peak because it becomes too optimistic, and then this will create conditions for a bear market.&#34;
If the Federal Reserve cuts interest rates significantly, it could add fuel to the fire. He said, &#34;If they really cut rates significantly, it will be an extreme policy path, and I think the market may be getting closer to a bubble peak, we are very concerned about this.&#34;
While following the upward trend during a bubble is not a bad thing, after the bubble peaks, the market often experiences a rapid and significant decline, which may lead to investors significantly underperforming for a period of time.
<h2>Sonu Varghese of Carson Group</h2>
Sonu Varghese, global macro strategist at Carson Group, said he has been &#34;thinking about rising risks for several months.&#34; Varghese said, &#34;We still like stocks and have not changed our overweight position, but we have increased exposure to diversified assets, such as long-term government bonds and low-volatility stocks.&#34;
Varghese's more defensive investment portfolio stance is mainly driven by potential policy mistakes that the Federal Reserve may make. He said that with the Federal Reserve's &#34;inflation war&#34; basically over, labor market trends are generally weakening, and policies are becoming &#34;too tight&#34;.
Varghese explained, &#34;The risk is that the Federal Reserve does not take aggressive enough action to stop the downward trend in the labor market, but instead adopts a gradual rate cut approach, which will further lag behind the curve. This also means that they will have to engage in larger catch-up rate cuts in the future (a replay of the Fed's mistakes in 2022, but in the opposite direction).
While he believes there is currently no risk of an economic recession in the United States, he stated that if the Federal Reserve significantly lags behind the curve, the risk of an economic recession in the next 6 to 12 months will increase.
Varghese warned, &#34;This could potentially impact stocks - investors may see bad economic data as bad news.&#34;
It should be noted that all three strategists insist on holding stocks and remain optimistic about the market's future, but even they are concerned about the so-called &#34;potential risk list&#34;

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Wall Street remains bullish on the stock market, despite the S&P 500 index nearing historical highs. Economists are concerned about a cooling labor market and potential economic downturn, but some strategists believe that the market sentiment is overly optimistic, which could lead to future pullbacks. Brian Belski from BMO points out that a rapid market rise could trigger selling, while Eric Wallerstein from Yardeni Research mentions that geopolitical tensions may impact stock market performance

- The S&P 500 index is close to its historical high, down less than 1%, yet Wall Street remains bullish. Concerns linger over a cooling labor market and potential economic recession, despite resilient corporate profits and the broader economy. Experts like BMO's Brian Belski warn of a possible market surge due to overwhelming bullish sentiment, highlighting risks of a significant downturn. Geopolitical tensions, nationalism, and market bubbles are additional worries shared by analysts like Eric Wallerstein and Sonu Varghese, emphasizing the need for cautious optimism amidst potential risks.

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