Saturday, April 18, 2009

Faber Says S&P 500 May Rise to 1,000 on Bank Earnings

by Admin on 04/17/2009

The Standard & Poor’s 500 Index may rise 17 percent to 1,000 in the next three months as government spending boosts bank profits, investor Marc Faber said.

“You have essentially a government that gives financials free money at the expense of the taxpayer,” Faber said. “With this free money, they may actually have decent earnings in the near future.”

Banks in the S&P 500 are forecast to post an 86 percent drop in first-quarter earnings, according to analyst estimates compiled by Bloomberg. Profits are projected to fall 57 percent in the second quarter and 52 percent in the third before rebounding 277 percent in the year’s last three months. (more)

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Traders, Not Investors, Fueling This Stock Rally: NYSE Chief

Friday April 17, 2009, 10:55 am EDT

Wall Street's stunning six-week rally has been fed more by traders looking to take advantage of quick swings in the market than investors with a long-term view, NYSE Euronext (NYSE:NYX - News) CEO Duncan Niederauer told CNBC.

Because of that, the rally likely is to run out of steam as low volume eventually comes back to the bite the market, he said.

"It feels to me we're in a trader's market and not an investor's market," Niederauer said in a live interview from the exchange floor.

Markets are likely to near their March lows after an upswing that has sent the major indexes more than 20 percent higher, he said. (more)

IMF predicts prolonged, deep global recession

The International Monetary Fund on Thursday forecast a prolonged, deep global recession, a "sluggish" recovery, and weak capital flows to emerging economies that would hammer eastern Europe.

"The current recession is likely to be unusually long and severe and the recovery sluggish," the IMF said in releasing two chapters from its twice-yearly World Economic Outlook (WEO).

The fund offered no timeline for a recovery from the first global recession in six decades.

The IMF also warned that "the decline in capital flows to emerging economies ... may be protracted, given the solvency problems facing advanced economy banks who provide significant financing to emerging economies." (more)

Business Week , April 27,2009

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