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Is the S&P 500 Headed to 1,700 in 2012?

Why one Wall Street veteran seems to think it's a possibility

Mar 1, 2012

by Max Fawcett

In stock-picking circles, news that Laszlo Birinyi has released a bullish forecast is about as surprising as Nouriel Roubini releasing a bearish one. But his latest forecast, which is contained in Birinyi Associates’s March “Reminiscences” newsletter, is particularly aggressive even for a perma-bull.

In it, he suggests that the S&P 500 Index could reach 1,700 – a 24 per cent rally from present levels – by the end of 2012. His rationale? That 2012 is starting to look a lot like 1995, a year in which subdued expectations gave way to a powerfully rally that pushed every major market in North America higher. “We are not insisting on a repeat,” the newsletter says, “but do believe that investors should consider the possibility; 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.”

Closer to home, Alberta Venture’s stock picking contest between Fabrice Taylor, Terry Freeman and Russell Dratwa has reached the one-month mark. The results:

Fabrice Taylor, Wavefront Technologies (CVE:WEE): UP 15.9 per cent

Russell Dratwa, Silvercrest Mines (CVE: SVL): UP 19.6 per cent

Terry Freeman, Flint Energy Services (TSE: FES): UP 68.5 per cent

Everyone’s doing well, obviously, but Fabrice and Russell’s picks still have some catching up to do. We’ll check back in on them in a month – unless someone else’s pick gets bought out, of course.



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