The Dow jumped Friday morning on a jobs report that suggested unemployment is finally starting to peak. What should investors be watching for in the next few weeks? Alec Young, equity strategist at Standard & Poor’s, shared his market outlook.
“The market needs news—we’ve been bumping up on this 1,110 level on the S&P, which is a key technical resistance level,” Young told CNBC.
“We’ve been spending 6 weeks trying to clear this level and we’ve had a lot of good news—the risk trade’s been working; the dollar’s been weak; the commodities strong; energy, materials and areas we like have done well.”
Young said the equity rally will continue into 2010, albeit at a more modest pace.
But he added that an increasing number of investors will continue to question whether private-sector end-demand will be strong enough to sustain growth, as the stimulus begins to fade heading into 2011.
Young is “overweight”materials, energy and industrials and “underweight”utilities and telecom.
- Watch Young's Previous Appearance on CNBC (Nov. 19, 2009)
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Bank of America
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No immediate information was available for Young or his firm.