By Cyril Tuohy
A new poll by the SEI Advisor Network finds that three out of four financial advisors say business profits will increase this year over last year.
The poll also finds a majority (58 percent) of advisors predict the S&P Index will close above 1,650 by the end of the year. The S&P 500 closed at 1,426 last year.
“We’ve seen it and the poll shows it, advisors are seeing strong business results and their optimism is growing,” said Kevin Crowe, head of product development for the SEI Advisor Network. “No one is blind to the fact that there are still hurdles to overcome, but you can’t deny some of the eye-opening profits that advisors are predicting for 2013.”
Several insurance industry executives have commented that the industry is entering an ideal period, one characterized by a strong stock market, and in which interest rates are slowly rising. Higher interest rates mean insurance companies earn more on their fixed-income investments.
Advisors who distribute insurance products also do well.
Despite the bullish outlook, only 12 percent of the 100 advisors polled were confident that the S&P 500 would close at a record high in the second half of the year.
As the nation enters the final quarter of the calendar year, political disputes over raising the debt ceiling are already starting to weigh on markets.
A total of 42 percent of advisors anticipated that the federal debt would emerge as the largest hurdle to economic growth before the end of the year, and 31 percent said tax policy would be the top hurdle to economic growth.
Advisors were evenly split when asked if the Federal Reserve would end its bond buying program before the end of the year. Federal Reserve Chairman Ben Bernanke surprised markets last week by announcing the Fed would continue with the buying program known as Quantitative Easing.
Cyril Tuohy is a writer based in Pennsylvania. He has covered the financial services industry for more than 15 years. He can be reached at [email protected].
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