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Legendary hedge fund manager Paul Tudor Jones told CNBC that next year could be a tough one for the stock market because of increased equity supply from big tech initial public offerings coming down the pipe as well as a potential reckoning from the ballooning U.S. fiscal deficit. <\/p>\n
“2027 is going to be really, really challenging for the stock market,” Jones told “Squawk Box<\/a>” on Tuesday. “You’ve probably got the most negative flow picture for the U.S. stock market that we’ve had, say, since 2002.”<\/p>\n The founder and chief investment officer of Tudor Investment said that corporate buybacks, along with mergers and acquisitions, have been a tail wind for the stock market for most of this four-year bull market as they decreased the equity supply. <\/p>\n That tide is now turning against the market with major offerings ahead in the AI space from Anthropic and OpenAI, along with one just finished for SpaceX<\/a>. There will also likely be more secondary offerings from companies in order to raise money for the AI build-out, said Jones. It all adds up to an increased equity supply picture that could weight on prices.<\/p>\n The billionaire hedge fund manager’s comments come as investors worry that a bull market now in its fourth year<\/a> could start to dwindle and run out of steam as concerns grow around mounting inflation, higher bond yields and a more hawkish Federal Reserve. <\/p>\n Jones repeated that the current period in the market is akin to 1999<\/a>, just about a year before the dot-com bubble burst in 2000. He noted the bifurcation in the current market between those companies benefiting from the AI boom and those that aren’t. <\/p>\n