Savvy stock market strategists are seeing the up arrows as the Big Q on the Street is: how much further the Bull can Charge before it stalls and lays down?.
Some traders believe a pullback has got to come and that this week is as good as any for that to happen, because of the low trade volume of trading, but others, many others several strategists say in notes they see stocks moving higher warning the naysayers could be proven wrong, and that this could be the beginning of a new Bull Market and a above average one at that..
Goldman Sachs strategists said they see progress on a number of economic fronts and are now boosting their exposure to cyclical stocks. Laszlo Birinyi says, if you look at history, it looks like the market’s still moving higher.
Citigroup’s Levkovich, chief U.S. equities strategist, said the investment community is “almost shocked” by the near 30 percent rise in the S&P 500 since early March, and that the case is building for a second half of Y 2009 recovery, that many investors are ignoring the fundamentals and following only the technicals in here.
Since early March, financials have risen 74%; cyclical consumer discretionary are + 46%; industrials gained 44%, and materials are up 41%, as the defensive sectors are under-performing. The move higher in the stock market is boosting US consumer confidence. For that reason, the market is seeing much better that average movement higher. A Key factor is that there are many of investors who missed the moves and are sitting with large cash hordes, about US$9.2Trillion.
Laszlo Biriniy says the market’s 53-day gain and 10 percent move above the 50-day moving average are second only to the market’s performance in 1933. He also says in a note that the net advances over the past 10 days are the third strongest in market history, and he makes a case for even more gains.
Brown Brothers Harriman’s Brian Rauscher, a long-time Bear turned Bullish in early March. He was concerned last month that the market could be showing signs of moving too far, too fast. But last Friday when asked does he think the market will go higher. He answered: “May have take a deep breath to get through 900 (a day or so), but this market is moving higher.”
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