SAN FRANCISCO--(BUSINESS WIRE)--
Outlook suggests the S&P 500 will close around 2,850 at the end of 2019
Wells Fargo Investment Institute (WFII) today released its “2019 Midyear Outlook Eyes Forward: Opportunities and Challenges.” The report makes the case that the current 10-year economic expansion is not over and that all avenues for investors to consider will require careful assessment.
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“The theme we adopted at the beginning of 2019, ‘the end of easy,’ still resonates,” said Darrell Cronk, president of WFII and chief investment officer of Wealth and Investment Management at Wells Fargo. “The first half of 2019 has delivered exceptionally strong capital market returns across most major asset classes. However, there are risks for investors to keep an eye on such as a meaningful yield-curve inversion, continued volatility in equity markets, and heightened geopolitical tensions.”
Paul Christopher, head of global market strategy for WFII, said, “Since early 2018, investor concerns have focused mostly on political uncertainties, and we view these as the main economic risk. Whether we are looking at Brexit or drawn-out trade negotiations, these geopolitical elements can deepen pressure on business confidence here in the U.S.”
To help investors maintain a forward focus, “they should consider rebalancing their portfolios to increase diversification and exposure toward areas of economic growth and where valuations remain attractive,” added Christopher.
The report outlines five strategies for investors to consider in the second half of 2019:
- Rebalance when volatility strikes.
- Potentially reduce price volatility with income-generating assets.
- Use cash to your advantage.
- Consider greater exposure to emerging market equities and sectors with higher-quality earnings.
- Add strategies that can benefit from various market conditions.
About Wells Fargo
Wells Fargo & Company (WFC) is a diversified, community-based financial services company with $1.9 trillion in assets. Wells Fargo’s vision is to satisfy our customers’ financial needs and help them succeed financially. Founded in 1852 and headquartered in San Francisco, Wells Fargo provides banking, investment and mortgage products and services, as well as consumer and commercial finance, through 7,700 locations, more than 13,000 ATMs, the internet (wellsfargo.com) and mobile banking, and has offices in 33 countries and territories to support customers who conduct business in the global economy. With approximately 262,000 team members, Wells Fargo serves one in three households in the United States. Wells Fargo & Company was ranked No. 29 on Fortune’s 2019 rankings of America’s largest corporations. News, insights and perspectives from Wells Fargo are also available at Wells Fargo Stories.
About Wells Fargo Investment Institute
Wells Fargo Investment Institute (WFII) is a registered investment adviser and wholly owned subsidiary of Wells Fargo Bank, N.A., a bank affiliate of Wells Fargo & Company, providing investment research, strategy, manager research and thought leadership within the Wealth and Investment Management division (WIM), with the goal of supplying world class advice to the company’s financial and wealth advisers.
Estimates and forecasts are not guaranteed and are subject to change.
Equity securities are subject to market risk which means their value may fluctuate in response to general economic and market conditions and the perception of individual issuers. Investments in equity securities are generally more volatile than other types of securities.
Rebalancing cannot eliminate the risk of fluctuating prices and uncertain returns.
Investing in foreign securities presents certain risks not associated with domestic investments, such as currency fluctuation, political and economic instability, and different accounting standards. This may result in greater share price volatility. These risks are heightened in emerging markets.
The information in this report was prepared by Global Investment Strategy. Opinions represent GIS’ opinion as of the date of this report and are for general information purposes only and are not intended to predict or guarantee the future performance of any individual security, market sector or the markets generally. GIS does not undertake to advise you of any change in its opinions or the information contained in this report. Wells Fargo & Company affiliates may issue reports or have opinions that are inconsistent with, and reach different conclusions from, this report.
The information contained herein constitutes general information and is not directed to, designed for, or individually tailored to, any particular investor or potential investor. This report is not intended to be a client-specific suitability analysis or recommendation, an offer to participate in any investment, or a recommendation to buy, hold or sell securities. Do not use this report as the sole basis for investment decisions. Do not select an asset class or investment product based on performance alone. Consider all relevant information, including your existing portfolio, investment objectives, risk tolerance, liquidity needs and investment time horizon.
The Consumer Price Index (CPI) produces monthly data on changes in the prices paid by urban consumers for a representative basket of goods and services.
S&P 500 Index is a market capitalization-weighted index composed of 500 widely held common stocks that is generally considered representative of the U.S. stock market.