Analysts remain bullish on stocks

Associated Press

NEW YORK

What’s the difference between an ostrich and a Wall Street analyst? An ostrich occasionally takes its head out of the sand.

Despite a flurry of signs that the economy is slowing, stock analysts — nearly every single one — have remained bullish on stocks. Greece may be hurtling toward default, the U.S. unemployment rate remains high, and house prices are still declining. But the hundreds of pros paid to tell us when to buy and sell stocks have barely touched their call for fast growth in corporate sales and profits for the next several quarters.

“There’s a lot of optimism here,” says Howard Silverblatt, chief index analyst at Standard & Poor’s. “They’re predicting the second half of the year will be the best ever for profits. Do you feel that way?”

Of course, no one can predict with certainty whether the economy will slow to a crawl or even fall into another recession. But what’s startling is the near unanimity among these prognosticators.

They believe that the economy won’t get much worse and say we’d be foolish to sell stocks despite a near-doubling in prices in the past two years.

Among the 9,015 analyst recommendations on S&P 500 stocks available today, only 300 are to sell, or 3.3 percent, according to data provider FactSet.

That’s the same proportion from a month earlier when the economy was considered to be in better shape.

All else being equal, you want to sell if you think profit growth could slow.