StocksThe elephant in the room remains the tapering schedule of the Federal Reserve regarding Quantitative Easing (QE). This will likely be a case of "selling on the rumor" and may enable buying opportunities after tapering.
When tapering begins, those companies unloved by Wall Street (such as those with sell recommendations or with low estimated growth) tend to perform better than Wall Street's "darlings."
With energy prices likely to head lower (along with other commodities), the better industry plays will be refiners, energy service and energy transport companies. We would underweight oil exploration.
Homebuilders should provide opportunities so as long as traffic remains robust.
Initial Public Offerings (IPOs) are a risky investment as they typically lose money their first year. Technology stocks are pricey and speculative stocks are extended. We recommend excellent diversification by size and sector in view of the generous level of stock prices.
Following significant advances in 2013, it would not be surprising for equities to undergo limited corrections the next year, but we nevertheless anticipate 2014 to offer positive, not spectacular, returns.