World News: 02:42 GMT Monday 11th November 2019. [Yahoo Business News Feed via SPi World News]
(Bloomberg) -- U.S. equities should rise into year-end amid stabilizing economic growth and increased chances for a tariff rollback, according to Evercore ISI.“The VIX curve is very steep/defensive and the resolution to that steepness could come with the longer end coming down (bullish), or with a spike in near-term implied volatility,” Evercore strategists including Dennis DeBusschere wrote in a note Nov. 10. “Stabilizing economic growth and some tariff rollback increase the odds of a bullish resolution.”Valuations are likely to remain near current levels as financial conditions will probably remain easy, and given earnings estimates for the S&P 500 Index into 2020, the gauge should be biased higher into year-end toward the 3,150 level, Evercore wrote. The benchmark closed Friday at a record 3,093.08.Strategists have become increasingly bullish about the end of 2019, as more evidence emerges that a soft patch in U.S. economic performance may be over, U.S.-China trade tensions appear to have ebbed somewhat, and this time of year tends to be seasonally good for equities. Last week, JPMorgan Chase & Co. and Citigroup Inc. moved away from bets on gold in their asset allocations as risk-on mode takes hold.The Evercore strategists screened for stocks that may have been caught in the recent outflow from momentum funds despite having attractive risk profiles. They included Chipotle Mexican Grill Inc., Walmart Inc., United Parcel Service Inc. and AutoNation Inc. in a list of about 30 components of the S&P 1500 Index that had high price momentum at the start of the quarter, underperformed recently and are seen as attractive, they said.To contact the reporter on this story: Joanna Ossinger in Singapore at firstname.lastname@example.orgTo contact the editors responsible for this story: Christopher Anstey at email@example.com, Cecile Vannucci, Margo TowieFor more articles like this, please visit us at bloomberg.com©2019 Bloomberg L.P.
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