Quarter of U.S. Institutional Investors Still Looking for Bottom

October 13, 2009 (PLANSPONSOR.com) - While some investors are trying to contain their euphoria over a potential economic recovery, a new institutional investor survey has come up with a more somber outlook.

A news release from TheMarkets.com about its poll of 103 such investors found that 27% of those surveyed think that the market has yet to hit its bottom. For investors outside the U.S., the number jumps to 41%.

Traders outside the U.S. may be more pessimistic about a turnaround, but almost 50% of them expect the S&P 500 to return to 1500 by the end of 2011, versus 21% of U.S.-based investors, the news release said. More than half of U.S.-based respondents think the S&P 500 won’t return to its pre-collapse highs in the 1500s until 2013 or later.

According to respondents, key sectors of focus for investors over the next year will be energy, financials, and health care, in that order.

“Back in March and June, we saw investor focus heavily keyed in to what was going on in Washington, D.C., with financials being the primary focus in March and energy in June,” said David Eisner, CEO and president of TheMarkets.com, in the news release. “Now, energy remains the primary focus. Given that energy is not currently a priority in D.C., this may suggest a shift in focus away from areas being highlighted by the government and more toward fundamental market levers.”

In the survey, nearly half of respondents indicated that the price of oil becomes a bearish sign for the stock market at $100 per barrel, and over 30% think it is a bearish sign at $125.

The survey included professional investors in 20 countries.