Seven out of 10 Americans believe a recession is either somewhat or very likely, according to a new survey by Schroder Investment Management...

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Seven out of 10 Americans believe a recession is either somewhat or very likely, according to a new survey by Schroder Investment Management.

A recent AP-Yahoo poll found six out of 10 adults say a U.S. recession is likely in the next year. Many economists, meanwhile, lay the odds of recession at close to 50-50.

Given their gloomy outlook, poll respondents see the best stock-market returns in 2008 coming from abroad, especially from emerging markets. But they don’t seem to be acting on their conviction: 15 percent of respondents said they plan to invest in U.S. stocks during 2008, but only 10 percent expect to buy international equities.

Virginie Maisonneuve, Schroder’s head of multiregional equities, says Americans are still biased toward their home market because international stocks used to be expensive to trade. Since costs have diminished, the bias is waning, she says.

Investors looking for emerging markets to lead in 2008 may be disappointed. The markets could be overdue for a breather after the 31.2 percent annualized return for the MSCI Emerging Markets index over the past five years. Maisonneuve says a correction could offer long-term investors a buying opportunity, as these economies continue to grow faster than the developed world.