Birinyi Says S&P 500 May Surge 88% in Three Years (Update1) By Matt Miller and Eric Martin
May 20 (Bloomberg) -- U.S. stocks are at the start of a bull market that may spur an 88 percent advance in the Standard & Poor's 500 Index in the next two or three years, Laszlo Birinyi said. "We're confident we are in a bull market," Birinyi, the founder of Westport, Connecticut-based research and money- management firm Birinyi Associates Inc., said in an interview with Bloomberg Television today. The S&P 500 may jump to a record 1,700 as the economy rebounds from the worst recession since World War II, an increase from today's close of 903.47, said Birinyi, who spent a decade on the trading desk at Salomon Brothers Inc. Signs the global contraction is easing have spurred a 34 percent rally by the index since it sank to a 12-year low in March. Birinyi's October 2007 warning that a recovery in banks would be snuffed out presaged an 82 percent plunge in the S&P 500 Financials Index through March 6 of this year. Still, he was early in predicting the end of the bear market. He said on Dec. 8, 2008, that the S&P 500 bottomed the prior month, before the measure lost another 23 percent. The S&P 500 is down 42 percent from its October 2007 record of 1,565.15. Birinyi said investors should avoid the smallest U.S. stocks and buy companies like billionaire investor Warren Buffett's Berkshire Hathaway Inc., which he called "a good trading stock." He added that he owns shares of JPMorgan Chase & Co. and Wells Fargo & Co.
