"So far, it's been an extraordinarily good year for investors to rebuild; we got lucky," said Augustine, making an appearance at the Loews Vanderbilt Hotel from his home base of Cincinnati. Augustine spoke at a luncheon to about 200 invited clients of Fifth Third Bank on a day in which the stock market's Dow Jones industrial average rose more than 136 points to close at 10,406.96.
Here's what Augustine expects to see in 2010 from Wall Street, the car industry, the job market, interest rates and exports.
Wall Street vs. overseasThe Dow should stay above 10,000, although next year may bring a bit more volatility to daily trading, especially if Congress continues to wrestle with health-care reform and a financial industry regulatory bill.
Expect a big winner in stocks to be emerging markets — a sector that's up about 75 percent this year as growth in Asia and other overseas markets beats results in the United States.
Investors may want to wait for a pullback in overseas stocks and mutual funds before jumping in and buying at this point, but demographic trends look solid, Augustine said.
"There are 7 billion people on the planet today, and one of every six people lives in Asia and is between the ages of 18 and 34. Compare that to the 78 million baby boomers here. About 95 percent of the world's consumers are outside the USA," he said.
Large-cap U.S. companies that export goods are another category likely to show gains as they take advantage of growth abroad and more middle-class consumers in emerging nations. "We're pushing between 25 percent and 30 percent of our equity portfo-lios overseas right now, seeking growth," Augustine said.
Unemployment, interestNext year, expect 10 percent unemployment to linger amid increasing pressure on the federal government to fix it with corporate tax credits to boost hiring, or the government may decide to hire directly on its own.
(2 of 2)Extended Tax Credit for HomeBuyers and HomeownersRetailers close out best month in year
