By Lu Wang - Jul 6, 2010
Mary Ann Bartels, the Bank of America Corp. analyst who had forecast the Standard & Poor’s 500 Index to rise to 1,300 this year, reversed her bullish call and said stocks may extend their biggest decline since the rally began.
Bartels, ranked second among analysts who study price charts in Institutional Investor magazine’s most recent survey, shifted her view after the S&P 500 last week broke the February intraday low of 1,044.50 on increased volume while its 50-day moving average fell below the 200-day average in a so-called “dark cross.”
“The measured move upside objective of 1300-1325 is no longer a valid target on the S&P 500 this year,” Bartels, who is based in New York, wrote in a note to clients today. The benchmark may sink as low as 950 and that “would fit with an economic slowdown scenario.”
U.S. shares are experiencing the largest losses since the bull market began in March 2009, when the S&P 500 index sank to a 12-year low. The benchmark has slumped as much as 16 percent from its 2010 high in April on concern a sovereign-debt crisis in Europe and China’s moves to slow the world’s largest emerging economy will curb global growth. It closed at 1,028.06 today, down 0.5 percent for the session and off 7.8 percent this year.
Should the market fail to stay above 950, Bartels said, the S&P 500 may retreat to as low as 869 -- the July 2009 low -- and that would suggest “the market is discounting a potential double dip for the U.S. economy.”
Investors should favor “defensive stocks,” or companies whose earnings are less affected by economic swings, such as utility and phone shares, she said. “Defense is the name of the game -- even on a tactical rally,” she said.
To contact the reporter on this story: Lu Wang in New York at lwang8@bloomberg.net |
发表于 2010-7-6 22:06
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