Goldman Sachs, which is one of the largest financial firms in the U.S. (and the world), just came out and said that they expect big pension and 401k plans to rebalance their portfolios out of bonds and into stocks going into the end of the year. This is something I've touched on before as I also believe that mutual fund and pension fund managers will be buying stocks as they represent a better risk/reward investment.
In leu of the financial stocks being hit the hardest this year, AND because they are stable and business has been steadily improving, it is my expectation that investment managers will be looking to buy stocks in this sector. My favorites remain Citigroup, Suntrust, Etrade, Synovus and KKR Financial.
In economic news, October new-home sales were below expectations. The good part of the housing release was that inventories of "new-home" sales are at a all-time low, but the overhang of the large inventory of unsold "existing-home" sales still remains extremely high. Important to note that 90% of total homes sold are "existing-home" sales.
