![]() "Are valuations high? No," wrote Binky Chadha, Deutsche Bank's chief US equity strategist, in a note about his 2024 outlook. ![]() The Frankfurt-based firm is confident that corporate earnings will build on this year's gains in 2024, and it's not worried about stock valuations. Stock-market outlook: The investment firm with the most accurate S&P 500 target last year is one of the most bullish about stocks heading into 2024.ĭeutsche Bank expects further gains for US stocks next year, even though a recession remains a serious possibility. Investors looking for stocks in those parts of the market should check out a list of recent additions to the firm's model portfolios.įlorian Gaertner / Contributor / Getty Images Financials are historically cheap, Belski wrote, while tech firms can sustain their strong growth. ![]() Investing ideas: BMO recommends buying shares of financials and information technology firms next year. "We will continue to take our cue from labor market trends, and unless they take a sharp turn for the worse, we are simply not concerned about the recession debate at this point," Belski wrote. A mild recession wouldn't conflict with its base case, provided that the jobless rate doesn't spike to uncomfortable levels. His bear case is that the downturn is more serious and leads to higher unemployment and lower profits.Įconomic outlook: Although BMO thinks a downturn is still possible, it's more focused on the employment picture than what happens to GDP growth. In Belski's base case, earnings drive stock returns as the US economy experiences a "recession in name only," where the job market holds up and price growth falls back to normal. While his bull case is that the S&P 500 climbs 19.6% to 5,500 as earnings multiples jump due to lower inflation and bond yields, history says modest gains are more likely. "We believe 2024 will be Year 2 of at least a 3-5 year process that will see US stocks exhibit more normal and typical performance, paced by a backdrop of normal and typical GDP and earnings growth, valuation, and bond yield ranges," Belski wrote in his 2024 outlook note.Ĭhances are, US stocks won't be able to duplicate their jaw-dropping performance of 2023, Belski wrote. The firm's chief investment strategist, Brian Belski, believes 2024 will be a continuation of this year's return to normalcy for earnings, valuation, and performance. Stock-market outlook: Strategists at BMO Capital Markets are among the biggest bulls for the second time in three years. Account icon An icon in the shape of a person's head and shoulders.
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