A monthly Deutsche Bank survey of stock market professionals shows fewer and fewer believe the Standard & Poor’s 500 Index will be higher in three months. In fact, the September data shows optimism has only been lower once in the last year, if you subtract the share who predict it will go lower from the percentage who believe it will go higher. A net 14% of the 550 stock market professionals surveyed in September expected the popular stock market benchmark to rise, down from a net 22% in July, the last time the survey was taken. In the last year, the only other time there was less optimism was in May, when higher-than-expected inflation was seen as a big risk to stocks and the net share was just 6%. The S&P 500 is up 18% this year, having been relatively immune to economic uncertainties raised by the recent surge in COVID-19 cases. The index touched a record high a dozen times in August alone and last set one on Sept. 2. Since then it’s down 2.3%. “Remember the market has run up a long way over this period,” said Jim Reid, head of thematic research at Deutsche Bank, in an email Tuesday. He forecasts stocks will see a correction of between 5% and 10% this quarter but rally back to close to where they are currently by the end of the year. Have a question, comment, or story to share? You can reach Medora at medoralee@thebalance.com.
