Stable interest rates and low inflation have increased U.S. money managers’ outlook on stocks, according to a quarterly survey by Russell Investment Group, The Wall Street Journal reports.
Eighty percent of the executives surveyed at 87 money management firms said they expect stocks to rise next year, and nearly one-third said those gains will be 10% or more. Thirty-seven percent said stocks are undervalued, up from 35% three months ago. This is the highest percentage to view stocks as low priced in the 2-1/2 years Russell has conducted the survey.
The asset class money management executives are most optimistic about is large-cap growth, with 77% bullish on it, up from 58% in the previous quarter. That’s followed with 61% citing non-U.S. equities and 54% emerging market equities.
The Federal Reserve has held the target rate at the same level for almost six months, noted Randy Lert, chief portfolio strategist at Russell. That should lead to stable rates for some time to come and help boost both corporate earnings and the economy, he said.
The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.