Tags: Byron Wien | stocks | higher | year

Byron Wien: Stocks Headed Higher Next Year

By    |   Friday, 06 December 2013 08:10 AM

Byron Wien, vice chairman of Blackstone Advisory Partners, has dropped his bearishness toward stocks and says they can keep rising next year.

Wien had predicted last year that the Standard & Poor's 500 Index would drop below 1,300 this year amid weak earnings. Instead, the index hit a record high of 1,814 last Friday and closed Thursday at 1,785.

To be sure, "earnings were disappointing this year," he told CNBC. But, "market valuation was not out of line, and while the economy was growing, the Federal Reserve was still keeping its stimulus program going," Wien said.

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"I think a large part of the appreciation in the market this year is a result of Federal Reserve monetary accommodation. That's what drove the market. It kept stock prices higher, and it kept interest rates low."

As for 2014, "if the economy keeps on growing at a 2 percent or better rate, if earnings do improve, maybe even being disappointing but still improving, and if valuations aren't excessive — and they're not — stocks can go higher next year," Wien said.

Goldman Sachs also sees gains for stocks next year. Its chief U.S. equity strategist David Kostin predicts the S&P 500 will end 2014 at 1,900, up 6.4 percent from Thursday's close.

"The linchpin of our market forecast is growth — in the economy, sales, and earnings," he wrote in a report obtained by Business Insider. "We expect 3.6 percent global economic growth. The U.S. will advance at a 3 percent pace, while inflation remains contained at 1.4 percent."

But not all experts offer such rosy outlooks.

Hedge-fund manager David Einhorn is taking a more conservative investing approach even as wagers that stocks would fall caused his results to trail the S&P 500 Index, Bloomberg reported.

“As the market continued its relentless climb, we’ve become more conservatively positioned,” he said.

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Byron Wien, vice chairman of Blackstone Advisory Partners, has dropped his bearishness toward stocks and says they can keep rising next year.
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2013-10-06
Friday, 06 December 2013 08:10 AM
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