The level of bullish commentary seemed to rise along with the stock market Wednesday, though trader focus remains centered on global events.
The Dow rose 67 to 12,086 in a rally led by global growth winners — materials and discretionary shares. The S&P 500 banged up against resistance and ended the day up 3 at 1297. Oil and gold were both higher on the day, as investors watched the Middle East and the latest sovereign debt saga in Europe, where Portugal's parliament debated and rejected an austerity budget.
"No new dictator appeared or was deposed. There was a lack of anything. The market continues to look like money desperately seeking a place to find shelter, and you've got everyone from Warren Buffett to the M&A deal in telephone (AT&T) to Birinyi this morning talking about the S&P going to 2100...There was a good deal of comment about that," said Art Cashin, director of floor operations at UBS.
"I think they're rallying back to the resistance level. Resistance is 1298 to 1303 on the S&P 500. That's where they stopped several times. This is going to be a level of interest" for investors, said Cashin.
Big Guns on CNBC
Cashin was referring to stock guru Laszlo Birinyi who said on CNBC's "Squawk Box" that the S&P 500 could reach 2100 in the next two to three years. "We're going to see a long-term bull market. The last bull market was five years. We're still looking for a bull market to last four to five years. If we cobble together all the long bull markets, we come up with a historical projection of about 2,100 out two to three years from now," he said.
Birinyi, however, wasn't the only one. As stocks rallied in the afternoon, Legg Mason's legendary Bill Miller appeared on "Street Signs" and said stocks are 20 percent undervalued. "I'm bullish — maybe not as bullish as Laszlo Birinyi was this morning," Miller said.
Omega Advisors CEO Leon Cooperman was also pro-stocks. "Stocks are the best house in a good neighborhood if the economic outlook materializes favorably longer term. I think stocks are the best house in a bad neighborhood if things deteriorate," he said.
Brian Rogers, chairman of T. Rowe Price, was also bullish in an interview on CNBC. He said the underpinnings of the stock market are really good, and individual investors are beginning to move out of low yielding bond funds back into stocks.
What to Watch
For Thursday, investors will be watching U.S. weekly jobless claims and February's durable goods at 8:30 a.m. Earnings are expected from Best Buy , ConAgra and Gamestop before the bell.
Oracle , Research in Motion , Darden and Accenture report after the closing bell. Several of those companies, including RIM and Best Buy, could discuss the effect of Japan's earthquake and its aftermath on their businesses.
Deutsche Bank chief U.S. economist Joseph LaVorgna expects durable goods to be unchanged, below the street consensus of a 1.2 percent increase. "I think the headline could be depressed by transportation. But I'm looking more forward to what revisions could be for January. I think what's possible is January looks better than we thought," he said.
"(Jobless) claims I think are going to stay comfortably below 400,000 though we're guessing 390,000. There might be a little bit of layoffs associated with Japan," he said, noting auto workers from GM's plant shutdown may be in the numbers. "But that's more likely next week."
LaVorgna said Wednesday's housing sales number could be the sign that the housing market is bottoming and that job creation should help real estate. Sales of new homes were at a record low in February and prices were the weakest in more than seven years. The sales of new homes dropped 16.9 percent to an annual rate of 250,000.
"The last set of numbers has been horrendous, but housing affordability is high and buyer traffic might be edging up," he said. "It seems to me that the worst case is we're going to go sideways, but I think there's a limit to how much residential investment can go down. If the labor market turns around...that goes hand in hand with stronger housing," he said.
Traders will be watching the aftermath of Portugal's parliamentary vote. Just before the Wall Street close, Portugal's parliament voted against the austerity budget, raising doubts about the future of the current government. Prime Minister Jose Socrates had said he would resign if the budget failed.
The euro edged lower after the news, falling below 1.41. Some strategists expect the euro's decline to be limited, even with negative developments in Portugal because European Central Bank President Jean-Claude Trichet has said the ECB may raise interest rates in April.
Meanwhile, European Union leaders hold a two-day summit starting Thursday. They are not expected to endorse a full package of measures to attack the sovereign debt crisis, despite the fact that they had been expected to do so for months.
For Europe, PMI and German IFO business sentiment data is released. "These are the two most important data points from the euro zone. They are the freshest information we have from the ground. If they are on the downside there is a real possibility the ECB will have to wait (to hike rates) and that will be the straw that breaks the camel's back," said Boris Schlossberg of GFT Forex.
Oil touched $106 in late trading Wednesday as developments in Libya and Yemen remained a focus. Crude closed at $105.75 a barrel.
"There was very bullish action in the options today. Several thousand May $125 calls were purchased...I don't see any big speculation on the down move, but there is plenty on the fear move up," said Ray Carbone of Paramount Options.
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