U.S. Markets close in 11 mins

Dow 20K is 'real possibility' in 2016: Jeremy Siegel

Matthew J. Belvedere

There is a "real possibility" that the Dow Jones industrial average (Dow Jones Global Indexes: .DJI) could hit 20,000 next year, longtime stock bull Jeremy Siegel said Monday.

The Wharton finance professor and economist told CNBC's " Squawk Box " that an interest rate hike by the Federal Reserve would give the market clarity.

Read More Dow 20K? These 3 stocks could it us there

The Dow, S&P 500 (^GSPC), and Nasdaq composite (^IXIC) were coming off their sixth-consecutive positive week for the first time since late 2014.

The central bank has not waited too long to raise rates, he added, but stressed it's now time. "If we waited too long, we would see the long [bond] rate raising a lot more, saying ... you're going to have a lot of inflation in the future. It's been very well behaved."

Read More Fed's Evans: We may be ripe for rate hike, but...

Months ago, Siegel predicted the Dow would end 2015 at 20,000. It closed on Friday at 17,809.

Siegel predicted two or three Fed rate moves next year.

Investors are trying to figure out whether Friday's strong jobs report would be enough to push the Fed to increase interest rates for the first time in nine years at its final policy meeting of the year in mid-December.

More From CNBC