Bob Doll's 10 Predictions for 2021

Related: Bob Doll's 10 Predictions for 2020

Nuveen's chief equity strategist and senior portfolio manager, Bob Doll, is relatively optimistic in his top 10 predictions for investors this year. Although he admits, like many strategists, that "2020 has already 'borrowed' some of 2021's returns," Doll sees room for more gains in the year ahead. "Stocks should get a boost from an economic recovery combined with continued hyper-accommodative monetary policy, fiscal support for households and businesses and negative real returns on government bonds," writes Doll. He refers to 2020 as "a year we all wish we could forget," and adds: "The unprecedented coronavirus pandemic changed everything." But stocks staged an unexpected strong rally after plummeting in March, ending the year with a gain of slightly more than 16%. Doll expects stocks will set another record high in 2021, marking a 12th consecutive year of gains; but they'll also lag strong earnings growth, with small-cap value and non-U.S. equities outperforming large-cap, growth and U.S. stocks. As he noted in his mid-April revised 2020 outlook, Doll expects health care and financials to outperform energy and utilities. Financials failed to do that last year, when utilities outperformed financials and energy equities. Doll says the biggest risk for financial markets in 2021 will be a greater-than-expected increase in inflation and interest rates. He anticipates that stocks will still advance, but will underperform earnings growth because of increases in inflation and interest rates. Check out the slideshow above for Doll's top 10 predictions for 2021. --- Related on ThinkAdvisor:

• Bob Doll's 10 (Mostly New) Predictions for 2020
• Bob Doll's 10 Predictions for 2019
• Where to Find Yield While Limiting Risk in the 2021 Bond Market