Daily Traders Edge

At this pivotal moment for the aging bull market, some smart investors are turning to value stocks and gold

March 12
10:33 2018

Investors may need to lower their expectations for stock gains this year after celebrating the ninth birthday of the bull market Friday.

The S&P 500 bottomed at 676.53 on its March 9, 2009 close. It has risen around 300 percent since the low.

We are at a pivotal moment for the financial markets — the tax reform plan is behind us, Wall Street-favorite Gary Cohn resigned from the White House and there are rising prospects for a Democratic wave in the November midterm election.

What should people do with their money amid the uncertainty?

CNBC asked several smart analysts and traders what advice they would give to average investors with a 12-month time horizon.

One Wall Street veteran still recommended stocks but said investors should expect a smaller gain than last year.

“I would say simply that those with a one-year time horizon should stick with equities although their expectations for returns (particularly from multiple expansion) should be lower,” Strategas chairman and CEO Jason DeSena Trennert wrote in an email Thursday. “There is a decent chance that, due to inflationary pressures and higher interest rates, the market will be up somewhat less than earnings.”

Trennert predicts corporate earnings will rise more than 12 percent in 2018.

A noted short seller suggested traders may want to avoid high-flying growth stocks and focus on value names.

Continue Reading at CNBC

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