The Charging Bull, sometimes referred to as Wall Street Bull, a bronze sculpture in the financial district of Manhattan with a face mask in New York on May 19, 2020.
Timothy A. Clary | AFP | Getty Images
Wall Street investors are bullish on stocks in the fourth quarter, but fear a second wave of coronavirus, according to a new CNBC poll.
As part of CNBC's quarterly report, CNBC surveyed dozens of investors, traders and strategists on where they stood for stocks and the potential impact on the election for the coming quarter.
Almost half (46%) of those surveyed said the S&P 500 will rise in the final quarter of 2020. This follows the fastest bear market and subsequent rebound in history, with the average of 500 stocks hitting an all-time high less than six months after its March low.
A third of the surveyed investors see increased volatility, but only 9% expect the S&P 500 to fall by the end of the year.
Amid a surge in coronavirus cases in countries like New York, more than 60% of respondents said a second wave of Covid-19 is their biggest concern about stocks right now. About 30% said the economy is slowly recovering and only 12% said election uncertainty was their biggest fear.
Markets and Choice
Investors are focused on the outcome of the 2020 election between incumbent Donald Trump and former Vice President Joe Biden. Nearly 70% of those polled said President Trump will be better for the stock market, while 33% said a Biden win would boost stocks.
Wall Street generally sees President Trump as more business-friendly. However, they don't like its volatile relationship with China. Some investors are questioning Biden's plan to hike corporate taxes and tighten regulation.
In the election, more than half of Wall Street pros said they were turning into cyclical stocks, stocks that would benefit the most from an economic comeback. A quarter of those surveyed stay with the technology winners, 13% take profits and 9% add cash.
Overall, though, Wall Street remains bullish on big tech. 63% of respondents say that the leading companies in FAANG (Facebook, Apple, Alphabet, Netflix and Google) will continue to be leaders in the coming months. More than half of those surveyed said they would buy technology stocks after falling on September 2nd. 37% see tech stocks lose their leadership spot in the fourth quarter, and 44% said the tech weakness isn't over.
As we head into 2021, the majority of the group said technology, industrial, and consumer discretionary will be the biggest winners. Energy, utilities and real estate were the most popular latecomers in the group.
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