Tags: Stocks | Gain | dow | market

CNNMoney Survey: Stocks to Gain 8% This Year Despite Volatility

Thursday, 14 June 2012 07:55 AM

U.S. stocks may be roiling now thanks to an escalating European debt crisis and weak economic indicators at home, but equities indices will finish the year in positive territory, a CNNMoney survey finds.

The S&P 500 will gain 8 percent from today's levels and end the year above 1,430, the survey of 20 investment strategists and money managers finds, the same level a March poll predicted.

The forecast rate would represent a 14 percent gain for the year as a whole, better than 2011's flat finish.

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

"Nothing has been too surprising this year," says Bell Investment Advisors chief investment officer Matt King, who predicts the S&P 500 to finish the year 1,500, CNNMoney adds.

Recent declines aren't a cause for concern.

"Given that fast start to the first quarter, we expected stocks would cool off with a 5 percent to 10 percent pullback."

Recent selloffs sent money to the sidelines and when better days return, that money will rush back into equities and fuel rallies later this year.

"Stocks have gotten too beaten up," Tom Schrader, managing director at Stifel Nicolaus, adding the S&P 500 will finish the year around 1,522, up from a March call of 1,500.

"Markets are oversold, and pessimism abounds. But the sentiment will start to turn around, and by the fall, we'll see a rally that will be even bigger than we previously anticipated."

Before that rally arrives, however, investors continue to yank money from equities funds today.

Investors withdrew a net $4.8 billion from U.S. stock funds in May, the Associated Press reports, citing Strategic Insight data.

Year-to-date, net withdrawals total $7.4 billion.

"U.S. investors' psyches have been battered with a stream of negative news, whether disappointments in job growth or disappointing progress on the eurozone problems," says Avi Nachmany, Strategic Insight's research director, the Associated Press adds.

"This has exacerbated the caution that many investors already felt."

Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.

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Thursday, 14 June 2012 07:55 AM
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