U.S. stocks are rallying and have a long way to run, says Laszlo Birinyi, founder of research and money-management firm Birinyi Associates.
Stocks have risen 55 percent from a 12-year low on March 9. Investors who wait for the National Bureau of Economic Research to officially declare the recession over are missing out on this bull market, the money manager says.
“I don’t know how you could wish for a better set of circumstances,” Birinyi told Bloomberg.
“The economy is probably a little bit better than most people are giving credit.”
Birinyi say investors should snap up financial stocks that are “strongly outperforming,” which would include Wells Fargo, JPMorgan Chase, and American Express.
Financial stocks in the S&P 500 have climbed 135 percent since March 9, the best performance among 10 industries and 60 percentage points more than industrial shares, the next best-performing industry, according to Bloomberg.
Many indicators point to an ending recession although policymakers say recovery will be slow, with unemployment remaining high and credit markets tight.
Even if the chorus grows among those who say the recession is currently bottoming out, others are saying it may have actually ended, if industrial output figures are of any indication.
Industrial output in the United States rose 0.8 percent in August, which was better than expected. The figure rose an adjusted 1 percent in July.
“The back to back gains in industrial production provide further evidence the recession ended around July,” Joseph LaVorgna, chief U.S. economist at Deutsche Bank, told Reuters.
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