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Goldman Sachs: Stocks to Soar Nearly 20 Percent

Friday, 04 Jun 2010 08:22 AM

The S&P 500 will soon jump 18 percent to 1,300, Goldman Sachs predicts.

Goldman Sachs believes the economy is on a rebound with the S&P 500 ending the year at 1,250. The S&P recently traded at about 1,102.

The downturns in the economy will benefit investors because they can add buys to their portfolio, Goldman suggests.

“Developments over the past two weeks have not altered our fundamental view. The market has plunged 12 percent in four weeks, but remains 60 percent higher than in March 2009," Goldman said in a recent report, according to the Business Insider.

"The pullback has been consistent with selloffs that occurred in recoveries following bottoms in 1974, 1982, 1987, 1990 and 2002. The correction has been orderly in that sector returns have been exactly in-line with beta-adjusted expected performance” Goldman said.

However, Eric Sprott, manager of the Sprott Canadian Equity Fund, believes the S&P 500 is just starting its nosedive, Bloomberg reports.

He recommends investors buy gold and to bet that stocks will continue their slump.

“Our thesis is we’re in for a long, deep cycle, and we’ve thought that since 2000, but up to this point, governments and central banks have always tried to stave it off,” Sprott said.

Recovery isn't on the horizon for many countries, including the United States, China and Europe, Sprott said. Many are starting to see signs of extreme weakness.

“We can see the dots aligning that the world’s economies are not what they thought they would be, and they’re not going where we thought they would go. It seems more clear-cut now,” he said.

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The S P 500 will soon jump 18 percent to 1,300, Goldman Sachs predicts. Goldman Sachs believes the economy is on a rebound with the S P 500 ending the year at 1,250.The S P recently traded at about 1,102. The downturns in the economy will benefit investors because they...
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2010-22-04
 

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