Birinyi: Market May Be “Insisting” Economic Consensus Is Wrong
Strategist Laszlo Birinyi is seeing parallels between today’s stock market sentiment and the bond market sentiment of the mid-1990s, and says that’s good news for stocks.
“In 1995, the consensus trade was higher yields, today it is tepid economic growth and the market is suggesting — perhaps insisting — an alternative to that consensus,” Birinyi wrote in a note to clients, according to Bloomberg. “We continue to be bullish and would encourage a more aggressive posture.”
Birinyi says an upside surprise on the economy could mean a big shot in the arm for the stock market. “If the market is right and the economy surprises us on the upside, gains similar to 1982 and 1990 are a distinct possibility and one which no one has entertained,” he wrote.
Birinyi, who was among the first strategists to advise buying stocks after the market bottomed in March 2009, thinks the S&P 500 could hit a record 1,700 this year if the economy shows improvement.