By the Numbers

Energy, Technology and Health Care to Lead in the Next 6 Months

Traders work on the floor of the New York Stock Exchange.
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Energy, technology and health care stocks are expected to perform best over the next six months, according to Charles Schwab’s most recent semi-annual studyof more than 900 independent registered investment advisors.

Defensive names such consumer staples and utility companies are also among the preferred choices. Both of these sectors are currently up the most in the S&P 500 index so far this year, with gains of 5 and 8 percent, respectively.

The survey, which covers a six-month outlook for investments, client portfolios and the economy, reveals that only 37 percent of respondents feel bullish on the stock market, compared to 56 percent back in January. The majority (41 percent) are neither bullish nor bearish.

The study shows that 58 percent of advisors surveyed anticipate the S&P 500 to rise in the next six months, a 25 percent drop from January 2011 and the lowest level since January 2009.

Opinions over a potential “double-dip recession” remain divided. Since the beginning of the year, 52 percent of respondents believe a recession is unlikely to happen, compared to 28 percent who think it is likely to occur and 20 percent who chose neither.

Reflecting a conservative outlook, the number of advisors who intend to hold more cash has nearly doubled to 15 percent compared to 9 percent back at the beginning of the year -- fixed income investments are expected to rise to 12 percent from 6 percent.

Findings also point to advisors looking to marginally decrease their exposure to equities over the next six months, with 32 percent going to U.S. large cap domestic companies, 21 percent to emerging markets and 17 percent to international developed economies.

The table below includes stocks in the S&P 500 energy, technology and health care sectors trading farthest below their mean price target estimates.

Charles Schwab’s survey was conducted between July 26 and August 5, 2011. Participants account for over $207 billion in total assets under management.

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