CNBC Survey Shows Investors Fear This the Most Next Year

According to a CNBC survey conducted this week, investors are fearing inflation the most as we head into 2022.

The Delivering Alpha investor survey found that Wall Street investors believe inflation will remain a major roadblock for markets in 2022 and stocks will only see muted returns.

CNBC had 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 rest of 2021 and next year.

According to CNBC’s findings, more than half of the respondents said inflation is their biggest worry for 2022. Thirty percent said the Federal Reserve raising rates at the wrong time is their top concern, while 17% said the economic impact of a lingering pandemic is their No. 1 worry.

The consumer price index, which measures the cost of a wide-ranging basket of goods and services, saw a jump of 6.8% on a YOY basis in November, the fastest rate since June 1982.

The S&P 500 has also rallied over 27% this year to a record high. Over 50% of the survey respondents expect the S&P 500 to go up less than 10% in 2022. Nearly 18% think the market will produce another double-digit year, while 10% see a flatline for stocks.

The Fed also indicated that it will make aggressive policy moves in response to rising inflation, including accelerating the reduction of its monthly bond purchases. Fed officials also see as many as three rate hikes coming next year.

“There are serious headwinds to worry about,” Brad McMillan, chief investment officer at Commonwealth Financial Network, remarked. “Inflation is at the highest level in decades. Supply chain problems seem to be insoluble. If these issues keep getting worse, they could derail the recovery.”

“While inflation is a concern and source of volatility, it also makes stocks the most compelling choice among the major asset classes,” Tony DeSpirito, chief investment officer of U.S. fundamental active equity at BlackRock, said in a note. “Individual companies will manage through differently, highlighting the importance of a stock-by-stock approach.”

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.