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Whether you love or hate one of the world’s biggest permabulls is unimportant.  The fact is, BlackRock is the world’s largest money management firm and their Chief Equity Strategist plays an important role in how that money gets put to work in the markets.  He is cautiously optimistic on 2012 (via BlackRock):

Making predictions for a new year is always a difficult task, but this year the uncertainty associated with emerging markets growth, upcoming elections, and the European debt situation in particular, make the forecasting exercise especially precarious. Nevertheless, it is with this backdrop that we move forward with our predictions for 2012:

  1. The European debt crisis begins to ease, even as Europe experiences a recession
  2. The US economy continues to muddle through yet again
  3. Despite slowing growth, China and India contribute more than half of the world’s economic growth
  4. US earnings grow modestly, but fail to exceed estimates for the first time since the Great Recession
  5. Treasury rates rise and quality spreads fall
  6. US equities experience a double-digit percentage return as multiples rise modestly for the first time since the Great Recession
  7. US stocks outperform non-US stocks for the third year in a row
  8. Dividends and buybacks hit a record high
  9. Healthcare and energy outperform utilities and financials
  10. Republicans capture the Senate, retain the House, and defeat President Obama

Source: BlackRock

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