Surprise! S&P, Financials Seen Having a Strong Year

More than 50 percent of managers believe the S&P 500 will finish up at least 8 percent in the coming year, while financials will be the strongest sector and materials will be the weakest, according to CNBC's Trillion Dollar Survey of financial experts.


Financials were picked up 28 percent of respondents to stage a turnaround after being the biggest drag on the S&P in 2007. Tech was close behind at 27 percent, while healthcare was third at 17 percent.

The online survey gauged the responses of nearly 60 of the nation's top money managers, investment strategists and professional economists. Responses were collected from Dec. 31 through today.

Confidence ran high for the S&P in 2008, with 33 percent saying it would gain 8 percent and 23 percent estimating a surge of more than 10 percent. The S&P closed 2007 up about 2.1 percent.

The index could be weighed, though, by consumer discretionary, picked up 25 percent of respondents, followed by materials (23 percent) utilities (17 percent) and energy (15 percent) as the worst performers.

Some 30 percent of money managers picked the United States to have the best-performing stock market, followed by China (21 percent), India and Japan (16 percent each) and Eastern Europe (9 percent).

Interestingly, China drew the widest disparity in opinion. While it finished second among best-performing markets, it was first, with 33 percent, when respondents were asked which would be the worst performer. It was followed by Japan (17 percent), India and Russia (13 percent each) and Latin America (11 percent).

More than half -- 56 percent -- predicted a 50-50 chance of a US recession in 2008, while respondents were almost evenly split over whether the credit crunch will get worse. Also, the survey found experts optimistic about housing, with 58 percent saying real estate will get "a little better."