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- Energy stocks are gold in the market, according to "Shark Tank" investor Kevin O'Leary.
- "If you didn't own energy in the last 18 months, you missed the market," he said in a recent interview.
- O'Leary is bullish on the market this year, despite warnings of a recession and a stock crash from commentators.
Energy stocks are a bright spot in the market and the US is set to sidestep a significant downturn, according to "Shark Tank" investor Kevin O'Leary.
"I love energy. Everyone hates energy. If you didn't own energy in the last 18 months, you miss the market. Go where people hate it. Energy is driving the pivot," O'Leary said in an interview with Fox's "Kudlow" on Wednesday. "That sector is looking golden right now."
That echoes the view of other Wall Street strategists, who have forecasted a good year for energy, commodities, and industrials while other sectors continue to struggle after a bruising 2022.
Goldman Sachs' commodities chief Jeff Currie predicted markets would be gripped by an energy supercycle over the next 12 years, with significant gains in areas of the "old economy" following a long period of underinvestment that has led to supply chain snags. Those factors will drive prices higher over the next decade, Currie predicted, contrary to trends in tech and growth stocks, which will struggle against interest rates and high inflation.
O'Leary also remained optimistic on the economy broadly. He previously made the case that the US could still sidestep a recession in 2023, despite warnings of an impending downturn from other Wall Street forecasters. Though inflation is still well-above the Fed's 2% inflation target, the labor market and consumer spending are still strong, he said, emphasizing that a soft-landing was still possible.
He added that the market will benefit this year from gridlock in Washington, a "secret-sauce" that has traditionally led to higher returns in the S&P 500. He forecasted at least a 8% return on the benchmark stock index in 2023, rebounding from its dismal performance of last year.
Markets have also changed for the better after the pandemic, which could boost profits, he added.
"A lot of productivity came through the pandemic. A lot of digitization," he said. "The reason that you should think optimistically about margins and free cash flow is many companies have figured this out. There's a new America 2.0, and I hate to be optimistic when I should be pessimistic, but I can't be," O'Leary said.
That's contrary to what other Wall Street experts have said, warning of an impending downturn and market crash as the economy shows signs of stress. Bank of America, JPMorgan, and Citi have all forecasted at least a mild recession to strike this year, with Bank of America preparing for a 24% plunge in the market.