2005: Gray, With Mild Returns
With 2005 fast approaching, Wall Street analysts are once again gazing into their crystal balls. What they see is a dull but mildly positive year for stocks.
Although strategists are calling for higher interest rates and a weaker pace of earnings growth next year, they believe stocks will inch up as the economy continues to grow at a respectable pace.
The median forecast among the major brokerages is for a 4% increase in the S&P 500, although estimates range from a decline of 4.6% to a gain of 10%.
One of last year's most accurate prognosticators, Tom McManus of Banc of America, is actually among the more bearish pundits this year, saying the market could remain flat or fall slightly over the next 12 months."We continue to believe that stocks remain a riskier bet in 2005 than in the recent past," he said. "While both earnings and
Can Wall Street strategists make it two solid years in a row?
|Brokerage||Strategist||S&P 2004 Target||S&P 2005 Target|
|Goldman||Abby Joseph Cohen||1250||1325|
|Smith Barney||Tobias Levkovich||1025||1300|
|J.P. Morgan||Abhijit Chakrabortti||1120||1275|
|Merrill Lynch||Richard Bernstein||890||1250|
|Morgan Stanley||Henry McVey||1200||1250|
|Bear Stearns||Francois Trahan||1100||1200|
|Banc of America||Tom McManus||1160||1200|
|*Ed Keon replaced Ed Yardeni, who had a 2004 target of 1260.
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