Jeremy Siegel: 10% Stock Gain Possible in 2024

Economic data released last week suggests that the economy is progressing at a healthy pace,

"I would even call it a 'Goldilocks' pace," Siegel said. "The data is not too strong to encourage the Federal Reserve to tighten and certainly not too weak to start a slowdown in corporate profits."

The Middle East conflict and the danger to cargo ships in the Red Sea have pushed oil prices up and could lead to other supply chain delays, generating inflationary pressure, Siegel wrote.

"But so far these tensions are only impacting oil," he said, "and we see no signs in other commodities, which have been stable if not declining."

Siegel said he disagrees with those who think the Fed needs to make six rate cuts this year to have a good 2024.

The key point from the recent Federal Open Market Committee meeting was Jerome Powell, the Fed chair, being more flexible and willing to cut rates on economic weakness, he said, adding, "If real economic growth stays strong, the Fed could keep rates exactly where they are, and we could have strong equity markets."

Powell's flexibility lowers the probability for recession and raises chances for continued growth or a softer landing, Siegel wrote. An inflation flare-up could turn the economy more negative, "but I think the prospect of that is low."

(Photo: Lila Photo for TD Ameritrade Institutional)