Franklin Templeton's Dover sees a 'Sputnik moment' in DeepSeek news

Steven Dover, chief market strategist for Franklin Templeton — the head of the Franklin Templeton Investment Institute — called the DeepSeek news that roiled the market over the weekend and into Monday "a Sputnik moment," comparing it to when the Russians stepped up the space race and the rest of the world responded. "If it's true that something is coming out that is much cheaper and easier for companies to use, that is going to incease the efficiency and productivity of the economy and help the broad market significantly," Dover said. He noted that the weekend's news — and the start of the new Trump Administration — have not shaken his outlook for 2025, when he sees low double-digit gains, a broadening of the stocks that are working and heightened volatility, but no recession. Tom McClellan, editor of The McClellan Market Report, talks about how he believes that liquidity concerns are being overlooked by investors now, but they have him fully short the market. He notes that "event risk" tends to be heightened when liquidity is impaired, which could add to market volatility now; he pointed out that the DeepSeek news highlighted market overconfidence because investors were unprepared for weekend event risk. In the Market Call, Max Wasserman, co-founder and senior portfolio manager at Miramar Capital, talks about building a portfolio around dividend payers, with a mix of high- and low-growth companies.