A Christmas tree stands in front of the New York Stock Exchange (NYSE) in New York on December 1, 2023.
Angela Weiss | Afp | Getty Images
In the final CNBC’s Delivering Alpha Stock Survey poll of the year, the 300 investors, traders and money managers surveyed are behind Jerome Powell and the Federal Reserve.
Eighty-eight percent give the Fed an excellent or good score for 2023, that’s better than the 77% from the survey three months ago. More than half believe they’ll start cutting rates in the second quarter of 2024.
Those surveyed are mostly planning to put their money in the S&P 500, with 28% saying that would be a main target for them in the new year. Sixteen percent said they’d mostly be investing in Nasdaq 100 stocks.
About 12% said China would have the strongest growth followed by Japanese stocks, high yield bonds, long range US bonds and bitcoin, all coming in 8% apiece. Not one person surveyed said gold would be their favored investment of 2023. The commodity is near record highs and up 15% in 2023.
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In terms of sectors, 35% said financials would be the winner in the new year with 23% favoring high dividend stocks.
Still love the Magnificent 7
When asked what would do better in 2024, the “Magnificent 7” or the other 493 S&P stocks respondents were firmly behind the Magnificent 7 with 77% saying they’d do better cumulatively than the rest of the S&P 500. Of the tech basket, Microsoft was the clear favorite in the group with 44% saying they’d pick that stock first, Amazon was a distant second at 24%, followed by Nvidia at 12% after its big run in 2023. Alphabet, Apple, Meta and Tesla were all in single digits.
Big cap tech is the favorite area for investors looking to invest in AI according to the survey with 58% saying that’s where they’d put their money.
The big cap tech stock they were most behind was Microsoft at 39% followed by Nvidia at 35%, AMD at 13% followed by Amazon at 9% and Alphabet at 4%. While many analysts still like Oracle, that stock had zero percent support in the survey. Just a few months ago analysts were big backers, but according to FactSet only 14 of 27 now have a buy rating on the stock, 12 are neutral and one is a sell. Oracle which was touted as a great undervalued AI play is now 17% from the June high.
In case things get rough for the markets, 35% say money markets are the best place to be followed by 31% in U.S. bonds and 19% in plain old cash. Just 7% would choose gold, 4% for crypto and real estate.
Health care, energy, staples and utilities were the worst sectors of the year with utilities down 11% in 2023. The survey asked “which of 2023’s weakest sectors has the most upside potential in 2024?” Health care was the clear winner with 56% saying that had the best change of doing well. About 24% said energy stocks, 12% favored consumer staples and 8% picked utilities.
When it comes to the biggest risks for stocks in 2024, stubborn inflation and problems with commercial real estate ranked highest followed closely by slow growth. War overseas and a more militarily aggressive China scored 11% apiece.
In terms of the 2024 election, only 15% said it weighed “heavily” on their investing strategy in 2024 with 85% saying it would have little impact on their decision making.