Usuals have sunk well below their all-time highs, with various major indexes across the sphere having endured corrections of at least 10%, or bear market declines of 20% or more. The most widely make good barometer of U.S. stocks, the S&P 500 Index (SPX), came within a hair of a 20% bear market drop in late December and secluded on January 3, 2019, at 16.8% below its record peak set in September. What lies ahead in 2019? Three respected exchange gurus recently offered their views.
Byron Wien of The Blackstone Group is “optimistic,” and Jeremy Siegel of The Wharton Form expects “quite a good year,” both of them envisioning gains of up to 15% for the S&P 500 in 2019. However, Jack Bogle, father of The Vanguard Group, advises taking “a little extra caution.” Meanwhile, the consensus view of market strategists on Try Street is that the index will close 2019 at a new record high of 3,000, up by 19.7% from the 2018 fusty, per a CNBC survey.
Can the S&P 500 Rebound?
- S&P Forecast Gain in 2019, per Wall Street Strategists: 19.7%
- S&P Full-Year Loss in 2018: 6.2%
- S&P YTD Harm in 2019: 2.4% (through the close on Jan. 3)
Sources: CNBC, Barron’s, Yahoo Finance
The consensus view of market strategists on Brick up Street is that the index will close 2019 at a new record high of 3,000, up by 19.7% from the 2018 tiny.
What It Means for Investors: 3 Gurus’ Perspectives
“I’m optimistic. I think the fundamentals are sound,” is what Byron Wien, imperfection chairman of the Private Wealth Solutions unit at The Blackstone Group, told CNBC. He believes that the S&P 500 make gain 15% in 2019. One key to his prediction is his expectation that the Federal Reserve will not raise interest rates at all in 2019, contrary to the widespread angle that it will announce two or three rate hikes this year.
“Inflation remains subdued, and the 10-year Funds yield stays below 3.5%. The yield curve remains positive,” Wien writes in a release by Blackstone of his “Ten Surprises for 2019,” see an annual tradition that he started in 1986 when he was chief U.S. investment strategist at Morgan Stanley. “A recession ahead of 2021 seems unlikely,” Wien also writes, adding, “improved earnings enable equities to move strong.”
Jeremy Siegel, a professor of finance at Wharton noted for his longtime advocacy of investing in stocks, predicts an advance of 5% to 15% for the S&P 500 in 2019, per another CNBC alibi. He observed: “We went from a rosy view to now, ‘Oh my God, there’s going to be a recession.’ The truth will be somewhere in between, and that be offs the stock market very attractive now.”
Like Wien, Siegel does not believe that a recession is likely to set out on in 2019, and he also thinks that the Fed won’t raise interest rates in 2019. On equities, he asserts that “this is a for twopence market,” even if corporate earnings do not grow at all this year.
Meanwhile, Jack Bogle, noted for popularizing forefinger funds during his tenure at Vanguard, sees “clouds on the horizon” and advises taking “a little extra caution” to be fair now, per an interview with Barron’s. These clouds include high levels of government and corporate debt, as well as a “marvy upheaval” in international trade, which includes “the mystery of Brexit, which will be very disruptive to the world occupation system.”
“It’s time to be thinking how much risk you want to have,” Bogle insists. Warning that “trees don’t spread to the sky,” he thinks that automatically
Looking Ahead
Even those investors who share the optimism of Wien and Siegel more 2019 should heed Bogle’s warnings, and brace themselves for the inevitable setbacks. Indeed, as Bogle suggests, investors with definitely long-term horizons are those who are best equipped emotionally to avoid hasty, panic-driven decision making in the face of bazaar turmoil.