Investing

Traders on the floor of the NYSE, Oct. 7, 2022.
Source: NYSE

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Despite this year’s market havoc, investors are feeling fairly optimistic going into 2023, according to a new CNBC Delivering Alpha investor survey.

Four out of 10 predict that the S&P 500 will rise 6% to 10% next year. Nearly 2 in 10 are calling for gains between 11% and 19%. Meanwhile, 6% are calling for stocks to jump by more than 20%, which would wipe out this year’s losses for the S&P 500, which is poised to end 2022 lower by 19%.

We polled about 400 chief investment officers, equity strategists, portfolio managers and CNBC contributors who manage money about where they stood on the markets for the new year. The survey was conducted over the last week.

Risk in 2023 and the Fed

Nearly half of the respondents are feeling optimistic that the Federal Reserve can orchestrate some sort of “soft landing” for the economy as the central bank continues to raise interest rates. Indeed, policymakers earlier this month increased rates by half a point to the highest level in 15 years.

Notably, when asked about their biggest concern for the market, an overwhelming 73% of the participating money managers said it was Fed policy.

CNBC Delivering Alpha investor survey

Coming in second place was a Chinese invasion of Taiwan. Nine percent of the participants said labor and supply line problems are their biggest fear. Meanwhile 6% cited a massive resurgence of Covid, which is wreaking havoc in China right now.

Inflation and the investing environment

About 4 out of 5 participating money managers predict that inflation will continue to ease in the new year.

Key investing themes for 2023 are also emerging: 72% of those polled said they will focus on value over growth in the new year. Energy stocks will also be a favorite among investors in 2023, with 41% of those polled saying that’s where they’ll be concentrating. Participants were evenly split between high dividend stocks, financial names and health-care companies, with 31% favoring each of those categories in the year ahead.

Respondents were also asked which of these five famous stocks would they consider buying for 2023: Amazon, Alphabet, Tesla, Netflix and Meta. The overwhelming winners were Amazon and Alphabet tying at 37%. Tesla received 17% of the vote, with Netflix and Meta rounding out the list.

All five of those names have been crushed in the past year. In recent months, however, Netflix has staged somewhat of a recovery. Shares of the streaming giant are up 63% over the past six months, but they are still down 51% for the year.

On Tesla, 61% of the participants said they were losing confidence in the stock and the company’s CEO, Elon Musk.

Finally, don’t expect money managers to wholeheartedly embrace cryptocurrency in the new year: 81% said they wouldn’t touch it.

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