Beginning this spring, consumer and business spending should increase enough to help the U.S. economy grow, continuing to push down unemployment, according to Bob Doll, the chief equity strategist at BlackRock.
Despite the disappointing headline numbers from the December labor market report, more jobs were created in October and November than previously reported, Doll noted in his most recent report, while projecting that job growth will speed up.
The sluggish housing market isn’t pulling down the economy as a whole. Doll projects that cutbacks by state and local governments will dampen economic growth by half a point. The good news is that state and local tax receipts have already begun risen as the economy expands
BlackRock expects that 70% of companies will report better-than-expected results, boosting stock market returns.
Overseas, inflation in emerging markets and sovereign debt crises will continue to raise concern in 2011, but not enough to depress the world economy or “derail the bull market,” Doll said.