Veteran Wall Street economist Ed Yardeni says the Standard & Poor’s 500 Index could gain 7 percent to 1,565 by year-end, amid the ebbing of global crises.
“This bull market since March 2009 really has been a series of relief rallies following sell-offs triggered by concerns that we’re about to have an apocalypse,” Yardeni tells CNBC.
“It seems to me the market just absolutely loves postponed apocalyptic scenarios.” And it looks like that’s exactly what’s going to happen with Europe’s debt saga, the U.S. fiscal cliff and China’s economic slowdown,” Yardeni says.
Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible
“Central banks made sure we won’t have a Lehman-style meltdown anytime soon,” he says. Meanwhile, “earnings have been holding up well, and the U.S. economy is doing better.”
The S&P 500 has gained 14 percent so far this year.
Also on the bullish front, MarketWatch columnist Mark Hulbert made an interesting discovery about historical returns.
Going back to 1896, he found that the Dow Jones Industrial Average has averaged an increase of 2.7 percent in the fourth quarter, compared with 1.6 percent for the other three quarters.
“To be sure, these averages reflect substantial variability in the year-by-year results,” Hulbert writes. “Still, it would appear that the best bet for this coming fourth quarter is that the Dow will rise at its historically average pace of 2.7 percent.”
That would leave the index at 13,800 on Dec. 31. The DJIA closed at 13,575 Thursday.
Editor's Note: Economist Warns: 50% Unemployment, 100% Inflation Possible
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