Nvidia’s (NVDA) third quarter earnings beat seemed to leave investors unenthusiastic, raising questions about the sustainability of the artificial intelligence (AI) trade. Ahead of the new year, Marketgauge.com chief strategist Michele Schneider joins Morning Brief Hosts Seana Smith and Brad Smith to discuss how to position your portfolio in 2025, with a focus on the consumer sector. "We certainly have had an interesting shift as we got through the second half so far of 2024, where tech started to underperform, and we started to see some of the other sectors pick up. And that broadening out of a rally is probably overall more positive than just a growth tech stock leading," Schneider says, adding, "[Nvidia] could shift back to a more growth environment, and that makes me wonder how sustainable [Nvidia’s rally is,] if we don’t get the rest of the market to join along if you will." The strategist notes that outside of Big Tech, "I still have major keen eyes on the consumer sector because that has been in this consolidation for [more than ten months and] tried to break out and didn’t." She says she "really likes" the SPDR S&P Retail ETF (XRT) because of its "wonderful balance between consumer staples and consumer discretionary." Given the additional rate cuts expected in 2025 and the uncertainty about inflationary pressures under President-elect Donald Trump, Schneider says, "Watch that consumer sector because I really believe that that’s going to rule the overall sentiment next year."
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