New York – Stock strategists are still seeing up arrows when it comes to this market.
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One of the hottest debates on the Street these past three or four weeks is how much further the bull can run before it runs out of steam.
Many traders believe a pullback is inevitable and for some, this week is as good as any for that to happen, given recent low volume of trading.
But several strategists say in notes that they see stocks still moving higher. Citigroup’s stock strategist Tobias Levkovich warns the market’s naysayers could be proven wrong, and this could be an above average bear market rally.
On Monday, the Dow continued to ride high, up triple digits, while the S&P 500 has crossed 900, a level last seen on Jan. 8. The financial sector was one of the best performers, up nearly 4.9 percent.
New York – 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.
He said the case is building for a second half recovery, and many investors are ignoring the fundamentals. Since early March, financials have risen 74 percent; cyclical consumer discretionary have jumped 46 percent; industrials gained 44 percent and materials are up 41 percent. Meanwhile, the defensive sectors are underperforming.