One of Wall Street's most bullish forecasters has a bold new call for the stock market
Laszlo Birinyi thinks the S&P 500 can hit 3,200 by 2017.
That would be a 52% jump from where the benchmark index was trading on Tuesday afternoon.
In an interview with CNBC on Tuesday, Laszlo Birinyi of Birinyi Associates said:
"Most people don't realize that we are now in the second greatest S&P rally in history, and we are actually ahead of the 1990 rally. And if the market continues to gain 11 basis points a day as it has for the last six years, two years out or so, we're going to be over 3,000. So it's more a matter of guidance. What we're really trying to tell people is stay with it. Don't let the bad news shake you out. We've heard all the bad news before ... there's no reason why we can't keep on going."
Birinyi said that all the recent, unsettling news about China's slowing economy and stock market crash, and Europe's economic troubles, are "noise" as far as the US stock market is concerned.
And if your argument for a looming market crash is that stocks are overvalued, Birinyi recalls that strategists said the same thing in 1991 when the price-earnings ratio on the S&P 500 was 18x earnings. (It's now about 21x.)
That didn't stop the bull market for almost another decade.
On Tuesday afternoon, stocks were slightly lower on the day while the S&P 500 was near 2090.60.
The index's closing record of 2,130.82 was hit on May 21.
Here's what the current bull market looks like:
25 Canada Square, Level 33, office 50, Canary Wharf London, E14 5LQ +44 20 3608 6256
World Financial Markets - 0700 17 600 Varchev Exchange - 0700 115 44
Varchev Finance Ltd is registered in the FCA (FINANCIAL CONDUCT AUTHORITY) with a passport in the United Kingdom: FCA, United Kingdom - registration number: 494 045, which allows provision of financial services in the United Kingdom.
Varchev Finance Ltd strictly comply with the statutes of the European directive MiFID (Markets in Financial Instruments). targeting increased efficiency, transparency and uniformity of financial instruments.
Varchev Finance Ltd is authorized and regulated by the Financial Supervision Commission - Sofia, Bulgaria: License number RG-03-02-05 / 15.03.2006
The information on this site is not intended for distribution or use by any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.
Disclaimer:
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 63,41% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.