Sixty-three percent of experienced investors in a new survey by E-Trade believe the bull market still has room to run, up three percentage points from the third quarter and up eight points from a year ago.
Two-thirds of survey respondents said they expected the market to rise by 5% or more in the fourth quarter, way up from the 54% who said this in the 2016 fourth quarter.
Recent research showed that regulatory and political risk were driving investors to equities.
Fifty-nine percent of investors in the E-Trade study saw the U.S. economy as healthy enough for at least one more interest rate hike in the fourth quarter, up one percentage point from the previous quarter and six points from a year earlier.
"If the market has illustrated anything in the past few months, it's that it can take some punches," Mike Loewengart, E-Trade Financial's vice president of investment strategy said in a statement.
"And despite historically high valuations, further potential Fed action, natural disasters and significant geopolitical uncertainty at home and abroad, retail investors still appear to be eyeing opportunity as 2017 draws to a close."
Research Now conducted the survey in early October among an online U.S. sample of 918 self-directed active investors who manage at least $10,000 in an online brokerage account.
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