US stocks could surge in coming months but “recession coming in 2020”

Markets fell on Thursday.

The S&P 500 fell 0.2 percent, the STOXX Europe 600 fell 0.7 percent and the Hang Seng plunged 1.3 percent.

Meanwhile, LPL Financial strategists John Lynch and Jeffrey Buchbinder think that there is scope for further gains for stocks.

“We believe the S&P 500 is fairly valued at a forward PE ratio of slightly over 16,” the analysts said. They said that adjusted for inflation and interest rates, stocks are trading only slightly above historical averages.

LPL has a year-end price target of 2,950-3,000 for the S&P 500.

Credit Suisse chief US equity strategist Jonathan Golub also sees the S&P 500 hitting 3,000 by year-end.

“We're seeing the best earnings season maybe ever,” he told CNBC on Wednesday. “Stocks, if they don't rally, are going to get cheaper and cheaper.”

Scott Minerd of Guggenheim Partners also expects a surge in stocks over the next 12 to 18 months.

“I think stocks will go up another 15 to 20 percent,” Minerd told CNBC on Tuesday.

However, Minerd also thinks that “a recession is coming in 2020” and sees a 40 to 45 percent drop in stocks starting in late 2019 and into 2020.