The newly hawkish Federal Reserve and the ever-evolving virus have made life difficult for Wall Street’s stock prognosticators.
Take the latest forecast from Ed Clissold, chief strategist at Ned Davis Research. He sees the potential for an earnings slowdown and tighter Fed policy to push US equities into “a shallow bear market” next year before the S&P 500 bounces back to end modestly higher.
The cautious tone contrasts with his counterparts at Credit Suisse Group AG and JPMorgan Chase & Co. Jonathan Golub at Credit Suisse just lifted his 2022 target for the S&P 500 by 200 points to 5,200, citing the improving prospects for corporate earnings and easy financial conditions. Marko Kolanovic and his colleagues at JPMorgan say market volatility will subside next year when the pandemic ends and the economy fully recovers.