Outlook 2022: Passing the Baton

Just in time for New Year’s celebrations, LPL has released their Outlook for 2022, “Passing the Baton.” What do we see happening in the coming year? Click the image below to read the full report. Here’s a quick summary of the highlights:

  • Economy: As the U.S. economy moves more to mid-cycle, LPL strategists forecast 4.0 to 4.5 percent GDP growth in 2022. Fiscal and monetary policies played big roles in the economic recovery in 2021, but LPL’s strategists see 2022 playing out as a handoff—with consumers, productivity, small businesses and capital investments all playing a part in the next stage of economic growth.
  • Stocks: Expect solid economic and earnings growth in 2022 to help stocks deliver additional gains next year. LPL strategists believe the S&P 500 could be fairly valued at 5,000 to 5,100 at the end of 2022. Additionally, they favor U.S. over developed international, value over growth early in the year, and cyclical sectors over defensives.
  • Bonds: Expect interest rates to move modestly higher in 2022 based on near-term inflation expectations above historical trends and improving growth expectations once the impact of the COVID-19 Delta and Omicron variants recede. The 2022 forecast for the 10-year Treasury yield is 1.75 to 2.00 percent.

We hope you enjoy Outlook 2022 and here’s to a great year filled with good health, good times, and a continuation of the bull market. Make sure to read the full 2022 Outlook by clicking the image below.