US equities will climb through the rest of the year with the Federal Reserve’s aggressive interest-rate cut bolstering the chances of a soft landing for the economy, according to a survey of Bloomberg Terminal subscribers.
The rally will likely be too modest to take the S&P 500 Index above 6,000 before next year, with 44% of the 173 respondents to the latest Markets Live Pulse forecasting the benchmark will rise less than 6% from its Wednesday close and 19% expecting it to decline. The remaining 37% of those who took the survey expect a climb steeper than 6%.
An overwhelming majority expect a soft landing for the economy, with 75% forecasting that it will avoid a technical recession by the end of next year. A gain of 6% would roughly match the pace of the S&P 500’s advances so far this year.
Stocks and bonds fell after the central bank’s first rate reduction since 2020. The S&P 500 dropped to reverse a gain of as much as 1% after Fed Chair Jerome Powell cautioned against assuming big cuts would continue and signaled borrowing costs may need to remain higher over the long term than pre-pandemic norms. Treasuries sold off as Powell expressed confidence there wouldn’t be a recession.
The cautious expectations for stock gains from here underscore the uncertainty that still surrounds the Fed’s path — and the economy. Equities flip-flopped since a July peak, tumbling in early August and then again at the start of this month before recovering, as investors showed doubts the artificial intelligence boom can relentlessly drive profits higher. That theme looks to be lingering, with the survey showing a modest majority of 57% expect value stocks to outperform from here, while 43% see AI roaring back to take charge.
Survey respondents leaned into Powell’s assessment of a healthy economy, with 49% of them saying the best move now would be to add to equities holdings. There were 31% who favored buying bonds and the remaining 20% said it was better to add to cash or gold. Gold retreated 0.4%, paring this year’s rally that took the precious metal to a record.
The Fed’s first rate cut also clears the way for investors to focus on other potential headwinds for riskier assets, including the simmering tensions in the Middle East and the US elections set for Nov. 5. Survey respondents see a substantial impact on monetary policy as a likely outcome from the vote. Some 58% expect the Fed’s rate will be higher at the end of 2025 should Donald Trump win his way back to the White House, while the remaining 42% said the benchmark will be more elevated if Vice President Kamala Harris is victorious.
Both candidates have laid out plans to boost spending, and neither have addressed concerns that the federal government may be on an unsustainable path as government debt balloons.
The MLIV Pulse survey was conducted among Bloomberg terminal clients immediately after the Fed decision by Bloomberg’s Markets Live team, which also runs the MLIV blog. Sign up for future surveys here.
Rajesh Markan earlier this year pleaded guilty to one count of criminal fraud related to his sale of fake investments to 10 clients totaling $2.9 million.
From building trust to steering through emotions and responding to client challenges, new advisors need human skills to shape the future of the advice industry.
"The outcome is correct, but it's disappointing that FINRA had ample opportunity to investigate the merits of clients' allegations in these claims, including the testimony in the three investor arbitrations with hearings," Jeff Erez, a plaintiff's attorney representing a large portion of the Stifel clients, said.
Chair also praised the passage of stablecoin legislation this week.
Maridea Wealth Management's deal in Chicago, Illinois is its first after securing a strategic investment in April.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.