(Source: Bloomberg Television)
Laszlo Birinyi called the market bottom in March 2009 and he still likes what he sees three years on. Despite the stock market’s largest decline this year earlier in the week, he’s bullish on U.S. equities.
“While we may have stumbled for a day or two, I think the race is still on,” Birinyi told Bloomberg Television’s Betty Liu on Thursday. He reiterated his call from last week that the S&P 500 has the potential to reach a record high of 1,700 this year should economic growth surprise investors the same way falling bond rates did in 1995.
According to the news service, Birinyi said recent declines in smaller companies don’t portend the rally is slowing. He said the underperformance isn’t “troublesome” and recommended investors stay in equities.
“There’s always something that doesn’t fit the scenario,” said Birinyi, founder of Birinyi Associates Inc. “The market is saying some very good things about the economy which no one has factored in.”
Bloomberg notes the S&P 500 slid 1.5% on Tuesday, its biggest decline since Dec. 8, caused by a report that showed Europe’s economy shrank and as investors watched developments in Greece’s debt restructuring. The index had recouped almost all of that loss by Thursday.
“Should the index reach 1,700, it would represent a 26% climb from [Wednesday’] closing level of 1,352.63. The benchmark gauge for U.S. equities has gained 101% since the 12-year low on March 9, 2009,” the news service reports.