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  • Moderna’s vaccine announcement on Monday made the “light at the end of the tunnel” a little brighter as the stock market and economy look set to gain in 2021, Wharton professor Jeremy Siegel told Bloomberg. .
  • The famed finance professor said he expects stocks to have a “really tough time” over the next two to three months and then perform stronger than expected in 2021.
  • Siegel added that the so-called reopening trade will dominate the markets next year as work-from-home stocks are fully priced right now.
  • Visit the Business Insider homepage for more stories.

“Everything points up.”

That’s according to Wharton finance professor Jeremy Siegel, who told Bloomberg on Monday that the economy and stock market will be stronger than expected next year.

The professor said the “light at the end of the tunnel” cleared up on Monday morning after Modern became the second pharmaceutical company to announce a vaccine more than 90% effective in treating the coronavirus.

While Siegel expects a “really tough time” for stocks over the next two to three months, he doubled down on his view that 2021 will be much more positive for the market.

Read more: GOLDMAN SACHS: Buy these 20 deeply undervalued stocks now before the rally helps them rebound and crush Wall Street’s low expectations in 2021

Ahead of the election, Siegel told CNBC that the market would win in 2021 regardless of who is president because of “the enormous


liquidity

from the Fed and stimulus measures. Siegel added on Monday that pent-up demand will help stimulate the economy in 2021.

The professor also said there could be moderate inflation of up to 4% which would be good for stocks, especially international stocks which could outperform the US in 2021.

Stocks that depend on the economy reopening will be front and center next year, Siegel said, while tech companies and “work from home” stocks like


Zoom

are fully priced at this time and are unlikely to continue climbing much higher.

Read more: Barclays details its ultimate strategy for picking home market winners for a post-COVID world – and shares 2 stocks all investors should own before the recovery gathers pace