Five Stocks Poised to Lead the Market Higher

We're up double digits in two weeks on a few of these...

A recession is all but guaranteed at this point.

And that's not my opinion. JPMorgan Chase CEO Jamie Dimon said in a closed-door meeting that the "best case scenario" is a mild recession. Add this to the growing list of banks and asset managers like Apollo, UBS, Bank of America, BlackRock, and others who now expect a US recession in 2025.

But this shouldn't be a surprise; the Liberation Day tariffs have caused global trade to grind to a halt. Trade between the US and China is down 81%. The World Trade Organization has even revised its global trade forecast from +2.7% at the start of 2025 to -0.2% due to US tariff uncertainty. This has cratered consumer confidence, which is now at its lowest levels since the COVID lockdowns. And when you add in the 20% decline in inbound tourism to the US, our economy is at the beginning of a major shock.

And just like COVID, this will likely lead to empty shelves, mass layoffs, and a noticeable pullback in consumer spending just as we head into the second half of 2025.

But just like Tom Hanks famously said there's "no crying in baseball" in the 1992 film A League of Their Own, there is no crying in investing, either. We must play the cards we're dealt and adapt as necessary, which we've done extremely well in 2025.

Plus, the good news is markets are forward-looking. Stocks do not price in what the economy is doing today - rather, they price-in what company earnings will be 6-9 months from now.

That begs the question: what will the economy look like later this year? And what can we buy today to profit from this?

A Potent Recipe for Recession

As demonstrated, the near-term outlook for the economy is dire. There is no debating that.

The question is: how much of this dire outlook have stocks already priced in. Some of this is hard to quantify. For instance, CEOs of the largest American companies have started slashing costs in anticipation of a slowdown. As this recent Wall Street Journal piece details, all industries are being affected by tariffs.

Whether you're a railroad operator like Norfolk Southern, a medical device maker like Boston Scientific, or a consumer giant like Procter & Gamble, all are cutting costs, slowing hiring, and delaying investments until there is clarity from the White House.

I don't think there's any question about whether we're headed into recession. And the public seems to agree as even Polymarket is giving the US 57% odds of falling into recession:

But again, the market is forward-looking. Too many investors obsess over present or past data.

And one thing I am expecting in the next 6-12 months is a boat load of economic stimulus, none of which is currently priced-in.

Never, Ever Invest in the Present

Stanley Druckenmiller famously said:

"Never, ever invest in the present. It doesn’t matter what a company’s earning, what they have earned. You have to visualize the situation 18 months from now, and whatever that is, that’s where the price will be, not where it is today."

So what do I think the market will look like 12-18 months from now? I think there will be much more economic stimulus from the Federal Reserve, US Treasury, and global currency markets.

Jerome Powell has made it clear he is not going to cut rates. But again, that is what's happening now, which doesn't really matter from an investing standpoint. His term is up in January 2026. In the meantime, I expect a “shadow Fed chair” to jawbone markets higher—even before Powell moves. That process will likely start by late summer. And if the US does start to see deep recession signals, I expect Powell to cut rates.

Second, Treasury Secretary Scott Bessent has said his department has plenty of tools to backstop markets. This includes stepping in to support the bond market, managing liquidity via the Exchange Stabilization Fund, and coordinating with global central banks if necessary. While they won’t call it “stimulus,” actions like yield curve management, debt buybacks, and liquidity injections will all serve to grease the wheels of the financial system. Plus, we have the coming tax cuts from the Trump administration.

Third, and perhaps most importantly, the U.S. dollar is weakening steadily—a controlled devaluation that makes it easier for companies and countries to service dollar-denominated debt. This is a huge tailwind for global growth and US equity markets, even if it’s happening under the surface.

Put it all together and you have the setup for a very different environment 9-12 months from now: easier monetary conditions, a softer dollar, and a wave of global liquidity hitting risk assets. That’s the world I’m investing for—not the messy headlines you're seeing today.

And we’re already starting to see signs of which stocks might lead the next cycle.

These Five Stocks Look Like Market Leaders

We already purchased two of these stocks, both of which are up double digits.

But today, I'll show you how I'm identifying market leaders and which ones are currently on top of my watchlist.