Tags: Tepper | stock | worries | ECB

David Tepper: My Stock Market Worries Have 'Alleviated'

By    |   Friday, 06 Jun 2014 09:56 AM

Hedge fund star David Tepper, founder of Appaloosa Management, says the factors that led him to express caution about the stock market three weeks ago have now eased.

At an investment conference May 14, Tepper said he was "nervous" about stocks because of concern that the European Central Bank (ECB) wouldn't inject enough stimulus into the eurozone economy and that China and the United States were headed for sluggish economic growth.

But he told CNBC that he was encouraged by the ECB's bold actions Thursday, by stimulus measures China has pursued in recent weeks and by signs that U.S. economic growth is picking up after a 1 percent contraction in the first quarter.

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"Bottom line is, all of those things alleviated, one by one by one to a certain extent," Tepper said.

As for the ECB's stimulus package Thursday, that included a cut in its deposit rate to minus 0.1 percent, a reduction in its benchmark rate to 0.15 percent and a 400-billion-euro ($542 billion) lending facility for banks.

Meanwhile Friday, the Standard & Poor's 500 index notched another record high, its eighth in the past 10 days. Last week, the index climbed 1.3 percent, the third straight in which it has posted solid gains.

The ECB's strong easing steps apparently sparked the move. "[ECB President] Mario Draghi is taking a sledgehammer to the disinflationary environment in the eurozone," Chad Morganlander, a fund manager at Stifel Nicolaus, told Bloomberg. "His actions are well beyond expectations."

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Hedge fund star David Tepper, founder of Appaloosa Management, says the factors that led him to express caution about the stock market three weeks ago have now eased.
Tepper, stock, worries, ECB
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2014-56-06
Friday, 06 Jun 2014 09:56 AM
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