Business Week 2008 Forecasters Expect Further Gains

|
 |  Includes: DIA, IVV, SPY
by: Bespoke Investment Group

For some reason, Business Week decided to do away with their Fearless Forecasts outlook piece this year. Instead, they narrowed down the number of strategists from 80 to less than 15. Last year's consensus price targets for the major indices did pretty well. Strategists expected a gain in the S&P 500 of 5.85%, and the current YTD gain stands at 4.13%. They expected a gain in the Nasdaq of 9.62%, and the current YTD gain stands at 10.71%.

Below we highlight the strategists who made the closest year-end S&P 500 calls as of 12/21. Two Barry's (Barry Hyman and Barry Ritholtz) and Doug Bermingham are within a mere 7 bps of the actual price level of the S&P 500. (And we have to give props to Barry Ritholtz for making the best individual stock call in the survey with MOS - up over 300%.)

Not taking anything away from the forecasters this year, but you would think that Business Week would ask some of the better prognosticators in '07 to make predictions for '08. Tom McManus is the only analyst in the list above that gave forecasts in this year's publication.

Below we highlight Business Week's strategist predictions for 2008. As shown, Elaine Garzarelli, Laszlo Birinyi, Bernie Schaeffer and David Bianco are looking for the biggest gains in the S&P 500. Only two strategists are expecting declines in '08 -- Ben Inker and Robert Arnott. Tom McManus, who made the best prediction last year of this year's strategists, is looking for the S&P 500 to close '08 at 1,625. The consensus forecast from all 13 strategists is for a 2008 gain of about 9%.

We also provide each strategist's 2007 S&P 500 calls where applicable. As far as individual stocks go, AIG, ORCL, FCSX, PEP and SBUX were mentioned as favorites.

click to enlarge