Higher or lower: Where will the FTSE end the year?

Today is St Leger's day and therefore an apt opportunity to see who believes now is the time to buy the FTSE.

If you did sell the FTSE 100 at the end of April, as the old adage says you should, and you've just come back to see what's been happening there wouldn't be much to say. Then again, the blue chip index is still pretty much where it was at the start of the year too.

On January 4th the FTSE 100 started the day at 5,412. By April 30th the rally had already ended as woes at BP and debt worries in Greece had taken their toll and the index finished the month at 5,553. Some better company news has helped shares to come back from summer lows and on Friday the index closed at . 

That is perhaps not surprising given the sharp leaps and falls as BP's woes, the grim assessment of government debt across parts of Europe and an increasingly downbeat economic outlook were offset by ongoing support from governments and central bankers and the better than expected earnings from companies. 

Some believe that is pretty much where the FTSE 100 will end the year too.

Nick Raynor at online share dealer, The Share Centre, said 'I don't think it'll be any different than where it is now. I this we are going to see a little bit of fluctuation between now and Christmas but this is a fair level.'

He said there is a lot of uncertainty on interest rates and the economic backdrop, while company results would have to be better than he anticipates to push the market higher than current levels. 

Georgina Taylor, equity strategist at Legal & General, also thinks the recent volatility is set to continue and thinks the market will take a turn lower before making a rally at the end of the year to close at 5,600 - unchanged from where she saw the index at the beginning of the year.

Taylor believes uncertainty ahead of the US election and nervousness about sovereign risk issues will continue to weigh on sentiment 'until we've seen the budgets later in the year'. She believes we need more information on whether the governments in peripheral Europe are on track with their plans to cut debt.

Only then will factors such as valuations and yields begin to garner attention, she said.  

A straw poll shows that the team at Capital Economics have made the lowest year-end forecast at 5,200, perhaps not surprising given they believe the recent data in the UK is the start of a much sharper pullback in the economy than many are expecting.

The most upbeat was Jonathan Stubbs, the strategist at Citigroup, who believes the bad news has been priced in and as investors start to realise things are actually better than they fear the UK's blue chip index will start to rise again. He expects the index to finish the year at 6,000.

For investors with a longer time frame, or who don't want to just buy the index, an increasing number of people are saying now is the time to do your research and to build positions in those companies that can differentiate themselves and grow even in what is clearly going to be a difficult environment