Earnings Will Drive S&P to 1150-1170 by July: Strategist
Stocks fell Wednesday after a report showed housing starts fell more than expected and FedEx delivered a disappointing outlook. Should investors buy stocks on this weakness? Marc Pado, U.S. market strategist at Cantor Fitzgerald and Michelle Girard, senior economist at RBS shared their market outlooks.
“People are worried and latching onto any sign of pessimistic news," Girard told CNBC. "There’s too much reaction to the negative side."
"But our view of the economy has not changed, even with respect to this morning’s housing numbers.”
Girard noted that the underlying trends in the housing market are still higher compared to the numbers six months ago.
In the meantime, Pado said the housing recovery is not expected take place until at least 2011. Instead, investors should separate the economy from what companies are doing, and so focus on the earnings news over the short-term, he said.
“Domestic earnings are going to be very strong and comparisons are going to be very easy compared to the second quarter of 2009,” he said. “That’s the driving force for this market rally which we think will carry the S&P to around 1,150 to 1,170 area between now and the end of July.”
Scorecard—What They Said:
- Pado's Previous Appearance on CNBC (May 19, 2010)
- Girard's Previous Appearance on CNBC (Jun. 8, 2010)
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No immediate information was available for Girard or Pado.