Investors are buzzing about a generational buying opportunity in stocks. Markets guru John Hussman just dashed their hopes.

• Wall Street veteran Richard Bernstein sees a generational buying opportunity in US stocks.
• Longtime strategist John Hussman dismissed the idea, pointing to historical S&P 500 returns.
• Hussman has previously warned the benchmark index could plunge by 60% to about 1,600 points.

A Wall Street veteran recently hailed a generational buying opportunity for US stock investors - but John Hussman, a longtime strategist and financial historian, poured cold water on the prospect.

Richard Bernstein, the CEO and chief investor of Richard Bernstein Advisors, suggested in a note last week that there's a "once-in-a-generation investment opportunity in virtually anything other than those 7 stocks." He was referring to the "Magnificent Seven" - Amazon, Alphabet, Apple, Microsoft, Tesla, Meta, and Nvidia.

The former chief investment strategist at Merrill Lynch pointed to the US economy's resilient growth despite the pressures of inflation and higher interest rates, and said he doesn't expect a downturn or recession.

While a handful of mega-cap technology stocks such as Tesla and Nvidia are trading at heady levels in his view, Bernstein expects the wider stock market to climb as valuations are fairer, there's an economic tailwind, and he believes corporate profits are accelerating and will surge next year.

Hussman, the head of Hussman Investment Trust, disagreed firmly when an X user asked for his reaction to Bernstein's call.

"Here's a century of data that might help to identify a generational opportunity," he posted on X Sunday. "It's not on the buy side."

"'Show your work' doesn't just apply to math tests," he added.

Hussman attached a chart comparing the expected and actual 12-year total return from the S&P 500 in excess of Treasury bonds, between 1928 and 2023. It showed the benchmark index has consistently fallen well short of Wall Street's forecasts over time:

The longtime analyst has been sounding the alarm on stocks for a while. He recently pointed to Warren Buffett's favorite market gauge as evidence that equities are hugely overvalued.

Hussman also warned in October that market valuations were at "one of the three great bubble extremes in US history," and said the S&P 500 would have to crash by more than 60% to about 1,600 points to return to historical norms.