posted at 15:50
Author Name: Myles Udland
Bank Of America 2015 S&P 500 Forecast: 2,200
"Stocks certainly look more attractive than bonds," Subramanian writes, "[but] the case for stocks versus other asset classes is less clear. Similar to the forecast from David Kostin and the equity team at Goldman Sachs, Subramanian sees no multiple expansion for the S&P 500 in 2015. Despite the modest upside forecast, Subramanian still sees plenty of reasons to buy US stocks. " Sell Side Indicator, which tracks Wall Street Strategists' average recommended allocation to US equities, currently sits at just 52%," Subramanian notes. So with investors likely underinvested in stocks, this is a bullish sign. BofA Merrill LynchSubramanian also says that though the aging - and retiring - US population is often cited as a negative for stock, Boomers will need both income and capital appreciation, making the S&P 500's dividend-paying members attractive to these investors. Overall, though Subramanian expects more modest gains in 2015, she says the bull market is still in tact. "So while returns may compress from the outsized gains we have seen over the last several years, we remain constructive on equities. The bull market in stocks is not over, in our view."

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