We would grow increasingly cautious if equity prices continue rising over the first part of next year, as valuations would likely become more stretched. At this point, it would be premature to suggest underweighting risk assets such as equities and fixed income credit sectors. But if economic and market conditions evolve as we expect, we would likely shift in that direction in the second half of 2018.
Bob Doll is chief equity strategist at Nuveen Asset Management.
1 Source: Bureau of Economic Analysis
2 Source: Morningstar Direct, Bloomberg & FactSet