The Dow Jones Industrial Average could conceivably hit 17,000 next year, said Wharton School finance professor Jeremy Siegel.
Siegel in February said the popular stock-market measure could hit 15,000 by 2013, as despite gains over the past few years, historical valuations show stock prices have room to rise.
The index closed Monday at 13553.10.
Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.
“Going to the 15,000 level, which a few months ago people were very skeptical of that, we’re talking about the end of 2013. We only need to go up 10 percent from current levels. I’m not saying it’s a slam-dunk. Nothing’s a slam-dunk in the market. Odds are 3-to-2-to-1 on that,” Siegel told CNBC.
“The 17,000, when I first gave the prediction late last March, I said it was a 50-50 proposition. But I think that that’s a goal that is very, very attainable given the market circumstances,” Siegel added.
“That’s what the statistics show, that there was almost a 50 percent chance on past historical valuations and periods that the market would reach that 17,000 by the end of next year.”
Other experts agree that despite gains in recent years, stock prices still have room to rise.
Monetary stimulus measures have pumped up stock prices in recent years, as the Federal Reserve has cut interest rates and pumped liquidity into the financial system to prop up the economy, policy tools that weaken the dollar and send equities prices rising as welcome side effects.
Economic growth will continue to push up stocks going forward, other experts add.
“We are in a healthier state right now,” Chris Hyzy, who helps oversee about $325 billion as chief investment officer of U.S. Trust in New York, told Bloomberg.
“Next year, we think the growth clip in the United States and the globe is going to be better than expected. Over the next three years, we are bullish.”
Editor's Note: How You Lost $85,000 During the Last Decade. See the Numbers.
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