Goldman Says Stocks Need Stimulus Plan, S&P 500 May Drop to 752

Discussion in 'Wall St. News' started by ASusilovic, Jan 30, 2009.

  1. U.S. stocks won’t rally until Congress approves President Barack Obama’s economic stimulus plan and the Treasury resolves how to use its remaining financial- rescue funds, according to Goldman Sachs Group Inc.

    The Standard & Poor’s 500 Index will probably “retest,” or fall toward or below, the 11-year low of 752.44 it sank to in November, strategist David Kostin wrote in a report today. Still, the benchmark index for U.S. stocks will end this year at 1,100, a 30 percent surge from yesterday’s close, he said.

    The yearlong recession and dwindling credit forced consumers to scale back spending and companies to cut profit forecasts. To revive growth, the government set up the Troubled Asset Relief Program to help banks, and the House this week passed a more than $800 billion stimulus package. The Senate hasn’t voted yet.

    “Passage of a stimulus plan and resolution regarding the remaining TARP capital are critical milestones that must be passed for the S&P 500 to trade higher,” wrote Kostin, Goldman Sachs’s U.S. investment strategist.

    The S&P 500 last year tumbled 38 percent, the most since the Great Depression, after the collapse of Lehman Brothers Holdings Inc. froze credit markets and more than $1 trillion in losses at financial firms eroded profits. Since sinking to 752.44 on Nov. 20, the benchmark has gained 11 percent to 835.55.

    Last time we had a call from GS market rallied. I suppose this time, too.
  2. S2007S


    I have to agree that new lows are coming, I think we break 750 on the s&p and head towards 700, if you have patience you will be able to pick up many stocks 20-30% cheaper from todays prices.

    Dow is sitting at 8020, it will not take much to push it down another 1000 points which is quite possible over the next 2 weeks.
  3. if dow closes below 8555 just 2 hours and 10 minutes from now, it closes below the 200 month avg for the first time in decades

    if ppt has anything up their sleeve, thy gotta use it now
  4. Obama & Goldman Sachs are in bed together.

    It's funny to see so many on ET cry about Obama being bad for Wall Street when he got absurd amounts contributed to his campaign from Wall Street.
  5. S2007S


    0% chance of 8555

  6. 8552.25 actually

    i think it's pretty unlikely

    but within the distance of a 'jam job'

    they have all the motivation in the world to do it

    technically, they're fucked if they dont

    it wont really change anything if they do, but it will buy them a month

    of course, maybe this is the month they bought last month

    trillions spent, and if they still cant hold it, it looks pretty bad
  7. well, they've certainly passed up any chance to be subtle about it

    it's either giant sticks up, or nothing

    unreal, that this much stimuls cant hold above a (dow) 200 month close

    door now open to dow 5000 technically
  8. I have to agree. Indeed the constant intervention by the PPT has technically created a descending triangle on the SPX.

    If 5000 were ever broken, it's bye-bye to the 20th C. bull TL.
  9. as blatent as it would be, even ppt giant sticks up to close above dow 200 month avg would be better than letting it close well below

    real uphill psychology if close below

    i know from a trading perspective, it doesnt matter, but from a citizen perspective, it's disturbing
  10. 3 stabs below the 200 month with closes above for the previous 3 months, contained almost perfectly by the 5 month avg this month, and the december 'inside month' did no good

    this is really ugly technically

    a continued crash, after little more than a consolidation pause, really

    looks like the market corrected by time, not price :(
    #10     Jan 30, 2009