Money managers still expect significant economic growth in the U.S. in 2014 and do not expect turmoil in emerging markets nations to spread to developed markets, according to a quarterly survey by Northern Trust.
Over the next six months, the vast majority of about 100 managers surveyed by Northern Trust's multimanager solutions group in March feel positive about U.S. fundamentals.
Ninety-seven percent of surveyed managers expect accelerating or steady U.S. gross domestic product growth over the next six months, while 89% expect stable or improving job growth.
“Investment managers expect continued improving fundamentals within the U.S., supporting their bullish view on U.S. equities, despite less favorable valuations," said Mark Meisel, senior investment product specialist of Northern Trust's multimanager solutions group, in a news release.
Of the managers surveyed, 42% said they believe domestic equities are appropriately valued, while 30% view them as undervalued.
Emerging markets equities have the best valuations, according to money managers, with 64% answering they believe the asset class is undervalued, up from 57% the previous quarter.
Regarding turmoil in Ukraine and other emerging markets countries, managers are still positive, with 89% of managers saying there is only a small-to-modest probability those issues could spread to developed markets.