Institutional money managers used by Northern Trust Global Advisors anticipate near-term growth in both the global economy and corporate earnings in the first quarter, along with stability in interest rates and the housing market.
Eighty-four percent of the managers that participate in Northern Trust's manager-of-managers unit, surveyed in mid-December, expect profits to increase in the first quarter 2010, up slightly from three months earlier, when 83% expected an increase in profits in the fourth quarter.
Expectations for interest rates also remained similar to the September survey, with 21% anticipating an increase in the next three months and 77% anticipating no increase.
“This is probably the first quarter where there has been consistency from quarter to quarter,” Chris Vella, NTGA global director of research, said in an interview.
Also, 45% said the S&P 500 is undervalued, despite a sharp increase in stock values in 2009.
Seventy-six percent of managers in the fourth quarter believe global growth will accelerate over the next six months, down from 84% in the previous quarter. Twenty-two percent said global growth will remain flat in the next six months, up from 16%.
More than 100 institutional managers who participate in NTGA's external manager platform were surveyed.