Stocks May Be 'Remarkably Expensive': Chief Investor
Stocks rose Friday for a third session straight, with the energy sector in the lead. James Paulsen, chief investment strategist at Wells Capital Management and Jack Ablin, executive vice president and chief investment officer of Harris Private Bank, shared their market outlooks.
“There’s a decent reason to expect that the economy improves in the fourth quarter,” Paulsen told CNBC.
“And Chinese stopped their tightening campaign,” Paulsen added. “That, with a lag, is likely to pick us back up from this soft patch and rebuild confidence.”
In the meantime, Ablin said he is slightly cautious on the markets.
“Investors are playing scenario analysis and they’re reserving the chance of a double dip with earnings decline and P/E compression,” he said. “If you take a 9 to 11 percent chance of a worse-case scenario, then it would appear that stocks and bonds are roughly equally valued.”
“So before we run away and say we’re table-poundingly cheap, there are scenarios out there that suggest stocks are remarkably expensive,” said Ablin.
Preferred stock, particularly bank preferreds
International small caps
Global mega caps
Scorecard—What They Said:
- Ablin's Previous Appearance on CNBC (Sept. 2, 2010)
- Paulsen's Previous Appearance on CNBC (Aug. 26, 2010)
Market Views—Across the Board:
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No immediate information was available for Ablin or Paulsen.