Bob Doll: Stocks Likely to Breach October Low

Crossmark Global Investments Chief Investment Officer Bob Doll sees stocks breaching their October 2022 low when the market absorbs recession and reduced earnings expectations, he said in a report Monday.

The S&P 500 hit a 52-week low — 3,491.58 — on Oct. 13. The index opened at 4,085.20 Monday, suggesting it would drop by more than 14% to dive below the previous trough.

“We recommend underweighting risky assets versus government bonds, and the events over the past month have strengthened our conviction that investors should be conservatively positioned,” he said in his Doll’s Deliberations quarterly commentary.

“We continue to expect that the U.S. economy will likely enter a recession over the coming year and that defensive positions are warranted within an equity portfolio,” Doll wrote.

While he didn’t specify a timeframe, Doll wrote that stocks will breach the October low “when recession and reduced earnings expectations sink in.”