By Hal M. Bundrick
NEW YORK (MainStreet) ¿ As the headlines feed consumer anxiety regarding a government shutdown, global tensions and market volatility, financial advisors seem unconcerned. A survey conducted by SEI finds advisors increasingly confident, looking for a stable market ¿ and growing profits.
"We've seen it and the poll shows it, advisors are seeing strong business results and their optimism is growing," said Kevin Crowe, with the SEI Advisor Network. "No one is blind to the fact that there are still hurdles to overcome, but you can't deny some of the eye-opening profits that advisors are predicting for 2013. Advisors have clearly taken advantage of opportunities in the first half of the year, and those who have the strongest business processes in place are most likely to carry that momentum into the end of the year and beyond."
More than half of advisors surveyed (54%) said they're cautiously optimistic about the remainder of the year, and slightly more than that (58%) predict the S&P index will close the year above 1650 (Friday's closing price was 1691). In fact, a small group of the most positive advisors (12%) believe we'll see record highs for the S&P in the second half of the year.
Three-quarters (75%) think business profits will be better this year than last. But there are a few concerns. When asked what they anticipated as the main hurdle to economic growth, the top response was "federal debt" (42%) followed by "tax policy" (31%).
As for stock market movement, financial advisors expect the energy (26%), health care (22%), and financial (19%) sectors to perform best through the balance of the year. But predicting future actions of the Federal Reserve is another matter. When asked when the Fed might begin tapering its bond buying program, 50% predicted the Fed to begin the process of ceasing quantitative easing sometime before the end of this year.
In terms of the top challenges facing their businesses in the second half of 2013, advisors cited "business development" (37%) and "market volatility" (28%) as the biggest barriers to growth, according to the survey.
To spur business, advisors will be leaning on their social networks. Nearly two-thirds of advisors polled (62%) believe they will be more active with social media in the second half of 2013 than they were in the first half.
--Written by Hal M. Bundrick for MainStreet