Traders work on the floor of the New York Stock Exchange (NYSE) in New York City, March 28, 2023.
Brendan McDermid | Reuters
Wall Street investors believe the stock market is headed for losses after a positive first quarter, seeing cash as the best safe haven right now, according to the new CNBC Delivering Alpha investor survey.
We polled about 400 chief investment officers, equity strategists, portfolio managers and CNBC contributors who manage money about where they stood on the markets for the second quarter and forward. The survey was conducted over the past week.
Nearly 70% of respondents said the S&P 500 could see declines ahead. Thirty-five percent of the investors believe the biggest risk to the market this year is a misstep by the Federal Reserve, while another 32% said persistent inflation poses the most pressing threat.
The market has been particularly resilient so far even in the face of a banking crisis and continuous tightening from the Fed. The S&P 500 is on track to post a winning quarter, up more than 5%, after equities staged a big comeback with the government’s emergency rescue measures that helped stem the chaos in the banking industry.
“Economic concerns enveloping recession fears haven’t vanished as the yield curve still represents a counter to the market’s climb higher,” said Quincy Krosby, chief global strategist at LPL Financial. “But if the market can continue to edge higher in spite of a wall of worry that seems to climb higher with each new headline, it begs the question who’s right, and which side is more prescient.”
The Fed enacted a quarter percentage point interest rate increase last week, while signaling one more rate hike coming this year. Many investors believe the central bank should reverse course immediately as more rate hikes will exacerbate banking problems and cause a severe economic slowdown. However, Fed Chairman Jerome Powell explicitly said rate…
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