Bessemer Trust's Patterson: Fundamentals Strong for Stocks

Friday, 27 Sep 2013 09:52 AM

By Dan Weil

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Stock market fundamentals are looking pretty good, says Bessemer Trust Chief Investment Officer Rebecca Patterson.

Household net worth rose $1.3 trillion in the second quarter, she tells CNBC. "So consumers are getting wealthier, and inflation is staying low."

In addition, the U.S. job market is improving, Patterson says, adding that "Europe's doing better. China's doing better. So, the world is doing better.

Editor’s Note:
5 Reasons Stocks Will Collapse . . .

"You have the fact the [Federal Reserve] isn't moving quickly, and we know who's not going to be in charge of the Fed [Lawrence Summers], which is good news."

To be sure, the market has a few issues to fight through in coming weeks, Patterson stresses, such as the government budget and the debt ceiling, who will head the Fed after Ben Bernanke and the start date for tapering of the Fed's quantitative easing.

"If I look at the next 12 to 18 months, we're going to get resolution on all of these," she predicts. "I don't think we have a long shutdown. The Fed is going to move. Rates are going up. And that is going to help equities."

Some other experts are bullish on stocks too.

"We’ve been down this road before. It’s quite natural and healthy to have pull-backs in a bull market," Patrick Spencer, head of U.S. equity sales for Robert W. Baird in London, tells Bloomberg. Stocks have dropped in five of the last six sessions.

"We’ll shift into a stronger gear with a settlement on the budget and what I think will be a very positive earnings season," he said.

Editor’s Note: 5 Reasons Stocks Will Collapse . . .

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Bogle: Record High Stock Market Levels Are Not a Red Flag

Stock Trader's Almanac: 'Octoberphobia' May Be a Figment of Investors' Imaginations

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