Market expert predicts further gains after S&P 500 hits new record

TradingPub Admin | March 29, 2013

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Interested in learning more about the potential future gains of stocks? Laszlo Birinyi, president of market research firm Birinyi Associates Inc., has predicted that the benchmark S&P 500 Index will continue to move higher in value after reaching a new record level on March 28, 2013, according to Bloomberg. 

On that day, the group of stocks finished trading at 1,569.19, the media outlet reports. This represented a 0.4 percent increase for the session.

Recent attempts
The S&P 500 Index previously had a record close of 1565.15, which was reached on Oct. 9, 2007, according to The Wall Street Journal. The group of stocks has repeatedly neared the old high reached in 2007 before recording losses and moving down in value. 

"The market has been trying and trying, and we finally crossed the line," Quincy Krosby, a market strategist at Prudential Financial, which has approximately $1 trillion in assets under management, told the news source. "Having the Dow reaching new highs was good, but the S&P 500 is broader, it's bigger… it's an important message for investors."

Further gains
Birinyi previously advised his clients to purchase the S&P 500 before the group of stocks reached its recent low in March of 2009, according to Bloomberg. Since hitting this recent valley, the index has spiked 132 percent. He advocated cautious optimism, telling the news source in a March 26 phone interview that people should be open to the possibility that equities will enjoy further appreciation in 2013. 

He noted that the sharpest 2013 gains have been enjoyed by companies producing consumer staples such as soap and pharmaceutical drugs, while firms with earnings dependent on the general state of the economy have had the strongest increases during the bull market, the media outlet reports. 

"It's surprising to see that it's not the deep cyclicals or the names that I would have expected in a really good market," Birinyi told the news source. "It just shows that people are comfortable with the market, and there's a little bit more of a focus on stock picking than people realize." 

New market momentum
Gordon Charlop, managing director at institutional brokerage Rosenblatt Securities, told The Wall Street Journal that the S&P 500 was bound to reach a new record high, stating that "there seemed to be an air of inevitability to this" and that "we're here on the back of stimulus, we're here on the back of no real alternatives for investors." 

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