Tags: birinyi | stocks | blue | chips

Birinyi: Stocks Going Higher, Buy Blue Chips

By    |   Thursday, 14 May 2009 11:56 AM

Stocks will continue rising, perhaps through the summer, amid signs of economic rebound, says master market strategist Laszlo Birinyi.

“We’ve all underestimated the market and to a large extent also probably underestimated the economy,” he tells Bloomberg TV.

“We had an Armageddon scenario, and it’s not working out that way at all.”

What’s most encouraging is that even when there’s bad news, the market rebounds quickly, Birinyi says.

“You’ve had a number of stocks like U.S. Steel which have missed their earnings numbers. Then the stock goes down 10 percent, and yet an hour or two later it’s back up again,” he points out.

“So the ability of the market to take it on the chin and rebound is very encouraging.”

Because investors are pushing almost every company’s shares higher, the good and the bad, Birinyi recommends sticking with the bluest of the blue chips, such as Apple, Goldman Sachs and Berkshire Hathaway.

“In this kind of a market with everything going up, we would rather be with names we understand,” Birinyi says.

“I don’t want to be in the secondary fringe stocks that have participated just because they’re traded. I’d rather give up a little price appreciation for a little more security.”

Many experts have turned bullish, just like Birinyi.

Barton Biggs of Traxis Partners recently predicted in Newsweek, “we'll see a broad trading range [for the S&P 500 Stock Index] between…700 and… 1,450 to 1,500 over the next few years."

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Stocks will continue rising, perhaps through the summer, amid signs of economic rebound, says master market strategist Laszlo Birinyi.“We’ve all underestimated the market and to a large extent also probably underestimated the economy,” he tells Bloomberg TV. “We had an...
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2009-56-14
Thursday, 14 May 2009 11:56 AM
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