Goldman Sachs Group Inc. forecast the US stock market to be going upwards for at least next two and a half years. The prediction estimates that Standard & Poor 500 Index would climb by 26% for that time to a level of 2100. Yesterday Goldman Sachs issued a end of year prediction stating the index would rise till 1750. David Kostin, the bank New York based chief wrote “Our positive 2013 outlook for S&P 500 has played out much faster than we expected”.
Last week other financial companies – JP Morgan Chase and Thomas Lee updated the index forecast from 1580 to 1715. Because of the quantitative easing program S&P 500 has climbed 17% this year. The companies taking part of the index has been raising their dividends to even higher percentage than the index itself.
Dow Jones Industrial Average finished with a 0.34% increase yesterday recording a 19th consecutive Tuesday of gain. A boost of confidence for the index were the speeches of two regional Fed presidents James Bullard and William Dudley. They stated intentions of continuing the stimulus program reassuring the investors that would not change. Today at 15:00 GMT Fed Chairman Ben Bernanke is scheduled to testify before congress about quantitative program topic.
Todays leading stock sectors were health-care, consumer-discretionary and financial sectors, while communications recorded a loss. Home Depot climbed by 2.54% due to better than forecasts revenue. JP Morgan Chase Co. surged 1.4% after Chairman and Chief Executive James Dimon survived a proposal for splitting his two roles at the shareholders meeting. Medtronic, a medical devices company gained the significant 4.93% as company reported better than estimate revenue and margin.
On the losers side Carnival and Best Buy recorded expected declines in share price after missing forecasts. Both companies fell by more than four percent.
The main Fed event since February is supposed to start at 10 am EDT today. The Fed Chairman Ben Bernanke would make a testimony in front of the Joint Committee of Congress. His opinion on the quantitative easing program is expected with a high interest from analysts and investors all over the world. Many await Bernanke to take a neutral position on the topic of slowing down the bond-purchasing stimulus.