Further, 42% expect a decrease in gross domestic product growth, and only 21% expect GDP to go negative, marking a recession.
The poll of 151 advisers by MoneyShow.com, a multimedia investment education destination for financial advisers, investors, and traders, found advisers are bullish on U.S. equities, with 62% reporting they believe the S&P 500 will rise from now until the end of the year, a decrease from 71% bullish near the markets’ peak last October. However, the survey found that the proportion of very bullish advisors—those who expect the S&P 500 to gain more than 10% by the end of the year—has jumped to 20%, from 12% in last October’s poll. More than double that number (42%) of advisers believes the S&P 500 will rise less than 10%.
The asset class advisers expect to do the best between now and the end of the year was commodities (32% of advisers)—a significant increase over the 20% of advisers who predicted that class would be superior last fall. Large-cap U.S. stocks ranked second, selected by 26% of advisers. Foreign stocks, predicted to do the best by 36% of advisers last fall, only garnered 13% of the vote in the latest poll.
“That could mean that the bullish advisors have gotten even more bullish—or the big declines we’ve seen give stocks more room to advance,’ wrote Howard R. Gold, executive editor of MoneyShow.com, on the Web site. “But in a market like the one we’ve been through, we’ll take our silver linings anywhere we can find them.’
The majority of financial advisers, 65%, expect inflation to increase and 54% believe the Federal Reserve will lower short-term interest rates over the remainder of the year. However, 38% anticipate that rates will remain where they are, and a scant 8% expect rates to rise.