Sonny ---Good afternoon ---Here is Abby's comments and tergets :Cohen: Bull market tiring
Goldman strategist forecasts modest stock market gains ahead
May 16, 2000: 3:05 p.m. ET
NEW YORK (CNNfn) - Abby Joseph Cohen, one of Wall Street's most influential strategists, is still bullish on the stock market but warned investors not to expect the double-digit gains of the past.
Speaking Tuesday at a conference sponsored by the Economic Strategy Institute, a think tank, Cohen said she expects the Standard & Poor's 500 index of large company stocks to reach 1,575 by year's end - a 7 percent annual gain.
Over the next twelve months the co-chairwoman of Goldman Sachs' investment committee said she sees the index climbing about 11 percent to 1,625.
Cohen's projections would mean an improvement of sorts; the S&P 500 is flat for the year. But the forecast is timid compared with 1999 when the index jumped 19.5 percent.
"We went from a market that was dramatically undervalued to one that is priced close to where it should be," Cohen told the audience in Washington, D.C.
For years, Cohen called the stock market undervalued, an opinion seemingly confirmed by the bull market that followed. But in Tuesday's speech she repeated a recent mantra: That the market now is fairly priced.
In her speech titled "Is the Bull Tiring?" the answer appeared to be yes.
Cohen called future stock market gains "good" but not "abnormally large." (335k WAV) (335K AIF)
She offered a similar read on the economy. Cohen anticipates slowing growth in the nation's gross domestic product and lower inflation as energy prices fall.
"Ours is an economy that is solid at its core," Cohen said, pointing to low unemployment, productivity gains and corporate profit gains
Cohen spoke less than an hour before Federal Reserve officials were to announce their decision on interest rates. She made reference to her faith in their ability to steer the economy.
"We do not believe that policy makers are aiming to bring this expansion to an end," she said.
Ultimately, the Fed lifted interest rates Tuesday by a half percentage point. Stocks pared their gains after that announcement, but Cohen's remarks had no apparent market effect. But that's not always the case.
In March, the Goldman Sachs' strategist told clients to reduce their exposure to stocks and keep a little cash on hand, sparking a broad sell-off on Wall Street.
In a question-and-answer session, one participant made reference to that sell-off.
"Ever since April my stocks have been down because of your remarks," the questioner said, sparking widespread laughter.
Will follow up later
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