Citi's Drew Pettit Late 2025 Investing Playbook: Market Impact Analysis

On November17,2025, Citi’s U.S. Equity Strategist Drew Pettit discussed his late2025 investing playbook on CNBC’s Closing Bell Overtime [3]. While the full transcript is unavailable, his recent comments highlight consistent themes: market near fair value (pullbacks as buying opportunities), AI driving approximately half of S&P500 performance, cyclical recovery expected in2026, barbell strategy (U.S. mega-cap growth + European value), underweight emerging markets (EM) except China/South Korea, and preference for buying growth on pullbacks [1][2]. On the same day, U.S. equity markets closed lower: S&P500 (-0.61%), Dow Jones (-1.02%), NASDAQ (-0.35%) [0]. Defensive sectors (Utilities +0.84%, Healthcare +0.51%) outperformed, while Financial Services (-2.41%) faced steep declines—aligning with risk-off sentiment and Pettit’s emphasis on balanced positioning [0].

1. Pettit’s long-term growth thesis (AI, cyclicals) contrasts with near-term defensive market movement, indicating investors balance long-term upside with immediate uncertainty.
2. Financial Services’ sharp decline reflects sensitivity to Fed rate cut expectations, a core theme in Pettit’s recent analysis [2].
3. Defensive sector outperformance aligns with Pettit’s cautious near-term stance (market near fair value) [1].

• Opportunities
  : Buying growth sectors (AI, consumer cyclicals) on pullbacks; European value stocks; China/South Korea EM exposures [1][2].
• Risks
  : Valuation sensitivity (market near fair value increases volatility); Fed rate cut recalibration impacting interest-sensitive sectors (Financial Services); EM volatility except China/South Korea [1][2].

Pettit’s playbook focuses on balanced positioning for late2025: long-term growth via AI and cyclical sectors, paired with near-term caution (pullbacks as buying opportunities). Market movement on Nov17 reflects defensive sentiment, aligning with his cautious near-term stance. Key factors to monitor: upcoming Fed meetings (rate cut decisions), AI sector earnings reports (validate growth thesis), cyclical sector recovery indicators (for 2026 outlook), and China/South Korea market performance (preferred EM exposures) [1][2][3].