Tags: Tepper | stocks | 20% | S&P 500

Appaloosa’s Tepper Reportedly Says Stocks Might Rise 20% This Year

Thursday, 14 Mar 2013 08:34 AM

By Dan Weil

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Hedge fund manager David Tepper, founder of Appaloosa Management, sees further gains ahead for stocks this year, with the Standard & Poor’s 500 Index increasing 20 percent or more, a person familiar with his thinking tells CNBC.

It wasn’t clear from the CNBC story whether Tepper, who manages about $15 billion, expects that kind of gain for the year as a whole or in addition to the gains already booked.

A 20 percent increase from the S&P 500’s Wednesday close of 1,555 would take it to 1,866. A 20 percent gain from last year’s close of 1,426 would put it at 1,711.

Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation

Tepper declined to discuss his views in detail directly with CNBC. But he did tell the network, “We are still constructive on the market."

The hedge fund heavy has been bullish on stocks for several years, saying they would benefit from the “Bernanke put" – the Federal Reserve’s massive easing program.

Tepper’s bullishness helped his flagship fund generate a 30 percent return last year, far surpassing the S&P 500’s 16 percent return.

This year, the fund is up more than 10 percent, compared with 9 percent for the S&P 500, according to the person familiar with Tepper’s thinking.

Meanwhile, Yale economist Robert Shiller says investors shouldn’t count on confidence keeping stocks afloat. That positive sentiment can prove to be fleeting, he writes in The New York Times.

“Clearly, confidence can change awfully fast, and people can suddenly start worrying about a stock market crash, just as they did after 2007,” Shiller says.

The fact that the stock market hasn’t hit an inflation-adjusted record for 13 years “means that we haven’t made any real money in the stock market in 13 years, which hardly seems a reason for confidence,” he says.

Editor's Note: See the Disturbing Charts: 50% Unemployment, 90% Stock Market Crash, 100% Inflation

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