The stock market has $7 trillion in money market funds that could boost stocks. Bank of America predicts the cash will flow back in once the Fed cuts interest rates. Investors could see a huge surge in stocks with the record amount of cash on the sidelines.

Central bankers have held off on a third rate cut to assess tariffs’ impact on inflation. However, after a weak July jobs report, investors are betting on a rate cut in September. Markets are pricing in a 95.1% chance of a rate cut at the next policy meeting.

The return on cash and bonds is not great, prompting investors to consider moving cash back into the stock market. Record amounts of cash coming off the sidelines could provide a significant boost to equities. Tom Lee remains optimistic on the S&P 500, predicting a 4% upside from current levels.

Read more at Yahoo Finance: The stock market still has a $7 trillion secret weapon that could boost gains into year-end