Though he’s a famed bear, strategic investor Doug Kass sounds an awful lot like a bull right now.
Renowned for his market timing, Kass tells us that he’s not only increasing his net long exposure– he thinks the S&P could print new highs for the year.
From the financial woes of Europe to signs that China may be slowing significantly, “We’ve had a panoply of concerns but the market has only bent, it has not broken,” he says.
And Kass offers a little lesson in trading. “How stocks react to news is more important than the news itself. The strength suggests the market has discounted the known economic headwinds."
Consequently, Kass, who is president of Seabreeze Partners and a CNBC Contributor, believes positive catalysts in the market will prevail and he sees some big positives:
- Overall earnings and guidance were far better than expectations
- Apple is an important contributor to aggregate corporate profits and results were strong
- Concerns regarding domestic economic weakness may be overstated
All told, Kass says it’s time to hit the buy button. Following are the sectors and stocks in which Kass suggests putting money to work.
Banks: Bank of America, Citi, Goldman, Berkshire
Tech: Microsoft. Yahoo!. Broadcom, Intel
Industrials: Freeport McMoRan, GM, Ford
Staples: Clorox, P&G, Pepsi
“It’s not only the price action that’s brining me back to the land of the living,” says Kass. “We may also be seeing an important reallocation out of bonds and into stocks. It could be very powerful.”
* Doug Kass is also a contributor to the Street.com, Jim Cramer’s Real Money Pro web site
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Trader disclosure: On Apr 25, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders ; Karen Finerman is long AAPL; Karen Finerman is short AAPL CALLS; Karen Finerman is long BAC; Karen Finerman is long JPM; Karen Finerman is long WMT; Karen Finerman is long TGT; Karen Finerman is long RIMM CALLS; Karen Finerman is long HPQ; Karen Finerman is short MDY; Karen Finerman is short IWM; Karen Finerman is short SPY; Anthony Scaramucci is long AAPL; Anthony Scaramucci is long GS; Anthony Scaramucci is long JPM; Anthony Scaramucci is long IBM
For Gene Munster
Piper Jaffray was making a market in the securities of Amazon.com, Inc. at the time this research report was published. Piper Jaffray will buy and sell Amazon.com, Inc. securities on a principal basis.
For Doug Kass
Nothing to Disclose
For Michelle Stevens
Nothing to Disclose
For Rich Ilczyszyn
Rich Ilczyszyn is long SOYBEANS
CNBC.com with wires.