Morgan Stanley’s Jason Todd, who had been Wall Street’s most bearish equity strategist, boosted his 2009 forecast for the Standard & Poor’s 500 Index by 17 percent because of higher-than-anticipated earnings.
The strategist recommended investors cut stock holdings in July following a 41 percent surge in the S&P 500 since March 9. Todd now expects the index to finish the year at 1,050 after it rose 10 percent to 1,050.78 since his comments two months ago. He also upgraded his 2010 profit forecast for S&P 500 companies by 13 percent to $70 a share.
“The current rally is typical of what follows major bear markets and is not, in our view, the start of a new multi-year bull market,” Todd wrote in a note to investors dated today. “However, we now think it can run for longer than we previously expected.” (more)
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