Best of the Week
Most Popular
1. Best Cash ISA Savings Account for Soaring UK Inflation - February 2018 - Nadeem_Walayat
2.Gold Price Forecast 2018 - February Update - Nadeem_Walayat
3.Bitcoin Crypto Currencies Crash 2018, Are We Near the Bottom? - Nadeem_Walayat
4.Trump Bubble Bursts, Stock Market Panic Dow 1175 Point Crash Analysis - Nadeem_Walayat
5.Gold Corrects, Bitcoin Markets Crash, Whilst Stocks Plunge - Nadeem_Walayat
6.US Treasury Bonds: Fuse to Light the Bonfire - Jim_Willie_CB
7.Dow Falls 666 Points As Cryptocurrencies Crash And Krugman Emerges From His Van - Jeff_Berwick
8.Stock Market Roller Coaster Crash Ride Down to Dow Forecast 23,000 - Nadeem_Walayat
9.Trading the Shadows - Oil, Dollar, Stocks, Gold Trend Analysis - B.R. Hollister
10.Stock Market Analysis: Baying for Blood - Abalgorithm
Last 7 days
How To Trade Gold Stocks with Momentum - 19th Feb 18
Is a New Gold Bull Market on the Horizon? - 19th Feb 18
Stock Market Decision Point! - 19th Feb 18
An Inflation Indicator to Watch, Part 1 - 18th Feb 18
Get on Top Of Debt Before It Gets on Top of You - 18th Feb 18
Will the Stock Market Make a Double Bottom? - 18th Feb 18
5 Reasons Why Commodities Are the Investment Place to be in 2018 - 18th Feb 18
1 Week Later, Stock, Bond Market Risk Remains ‘On’ as 2 of 3 Amigos Ride On - 17th Feb 18
Crude Oil Prices: A Case of Dueling Narratives? - 17th Feb 18
Free 1000 Youtube Subscribers Services - YTpals, Subpals, SubmeNow Test - 17th Feb 18
How to Trade as We Near March Stock Market Top - 16th Feb 18
Bitcoin as Poison - 16th Feb 18
GDX Gold ETF Weathers Stock Market Selloff - 16th Feb 18
Casino Statistics and Demographics - 16th Feb 18
IS Today Thee Stock Market Turn Day? - 16th Feb 18
Huge SMIGGLE Shopping HAUL, Pencil Cases, Drinks Bottles, Back Packs, Toys.... - 16th Feb 18
Tesla Cash Keeps Burning at $320 a Share - 15th Feb 18
Big Conflict Ahead in the Financial Markets - 15th Feb 18
Stocks Extend Rally Off Friday's Low, But Short-Term Exhaustion Near - 15th Feb 18
Stock Market Out on a Limb... - 15th Feb 18
Things Only a True Friend Would Say About Gold - 14th Feb 18
Global Debt Crisis II Cometh - 14th Feb 18
Understanding Crude Oil Behavior - 14th Feb 18
Stock Market is Getting Scary... - 14th Feb 18
Stock Market - This Time is Different. Really?! - 13th Feb 18
Gold and Silver Long-term Buy, Short-term Sell Signal - 13th Feb 18
SPX Futures Are Sliding... - 13th Feb 18
Stock Market Topping Process Begins. The Bubble Finds its Pin - 13th Feb 18
Math Behind the Stock Market Crash and What’s Next – PART2 - 13th Feb 18
Gold Stocks Groundhog Week - 13th Feb 18
Platinum Looks Poised for Surprising Gains This Year - 12th Feb 18
Friday's S&P 500 Stock Market Bounce To Continue, But Selling May Resume - 12th Feb 18
The Inflation Trade and Bond Yields Rising Result in Equities Correction - 12th Feb 18
February 2018 Stock Market Crisis – What Next? - 12th Feb 18
How To Profit From The Bitcoin Bloodbath - 12th Feb 18
The Philippine Economic Dream Could Be Within the Reach  - 12th Feb 18
Is the Stock Market Correction Over? - 12th Feb 18
What Does the Stock Market Decline Mean for Gold - 12th Feb 18
Addicted to SMIGGLE Mega Review, Pencil Cases, Stationary, Back Packs, Drinking Bottles, Toys... - 12th Feb 18
Best Cash ISA Savings Account for Soaring UK Inflation - February 2018 - 11th Feb 18
The Fed’s Impossible Choice, In Three Charts - 11th Feb 18
US Stock Market, Gold, Silver and the Macro Backdrop - 11th Feb 18
After Two weeks of Stock Market Decline, People Are Ssking, “Are We There Yet?” - 11th Feb 18
How to Grow Tomatoes From Seeds, Homegrown Organic Money Saving Gardening - 11th Feb 18
Youtube KILLS ALL Small Channels with New DeMonetization Rules - 11th Feb 18

Market Oracle FREE Newsletter

Urgent Stock Market Message

Stock Market Forecast For 2014

Companies / Stock Markets 2014 Dec 09, 2013 - 10:14 AM GMT

By: Money_Morning

Companies

Michael A. Robinson writes: If you’ve been following our twice weekly conversations here at Strategic Tech Investor, you know that I’m very bullish about technology stocks.

But I want to let you in on a little secret …

I’m also bullish about the overall stock market.


In fact, I’m predicting that the Standard & Poors 500 Index will advance 15% in 2014, rising from the current 1,795 to 2,065. That will not only take the closely watched index up through the psychologically important 2,000 level, it will take it to the highest level in history.

And that’s the broad market index.

I believe that the tech sector could do even better.

So let’s spend today talking about my prediction – and conclude our talk by looking at an aggressive tech stock that I believe will trounce the market averages in the New Year.

The Zooming Markets

If you’re getting nervous in the face of this historic market rally, I can certainly understand. Over the past five years, the S&P has gained 105%. The index is up nearly 23% so far this year.

But you can also have some confidence in my forecast.

Back on June 28 – a point at which tech-sector analysts and other market pundits were increasingly predicting that the rally in technology shares would end – I told you to expect a big second half of the year for tech stocks.

Since that time, the tech-focused Nasdaq Composite Index has zoomed 19.5% – versus 11.8% for the S&P.

What I’m telling you now is that the overall stock market should continue to surge in 2014.

If you drill down and look at the facts, there’s simply no reason to let fear get the better of you. Signs that the economy – and the stock market – will remain healthy are everywhere.

Take what’s happening with lumber. Prices recently hit a seven-month high of $378.30 per thousand board feet.

And there’s a very good reason why demand for lumber is so strong. In fact, it’s one of the three reasons I’m going to share with you that gives me such confidence that the American economy – and the stock market we keep score by – will continue to display muscle.

Housing Heats Up

Of all the factors that affect the economy and the stock market these days, the housing sector remains by far the most emotional.

Quite literally, it hits people right where they live.

If you happen to live in parts of Houston or Chicago – where real estate values are predicted to remain flat or slightly down this year – then national stats don’t make you feel all that much better.

On the other hand, there’s just no denying the impact that a strong national market for real estate can have on the economy.

When people buy new homes they end up purchasing a lot of furnishings: refrigerators, dishwashers, security systems, furniture and more. They also hire painters, designers, electricians and carpenters.

Consider that construction employment totaled 5.83 million workers in October, an increase of 185,000 from a year earlier. The Associated General Contractors of America, a trade group, says that was the sector’s highest jobs level since August 2009.

A look at the underlying numbers tells you why.

The National Association of Realtors (NAR) just reported that home sales were up 6% in October on a year-over-year basis – with sales reaching 5.14 million units. Even more important: On a year-over-year basis, that October advance means that housing sales have now increased for 28 months in a row.

Rising home values just make people feel richer. Economists refer to it as the ‘wealth effect’ and have proven that it correlates with increases in car sales or growing investments in the stock market.

Automakers Put the Pedal to the Metal

The last time I talked to you about my next-door neighbor Steve, he was busy cutting down Eucalyptus trees.

That was back on Sept. 13. At the time, we talked about how Steve’s willingness to spend thousands to cut down trees in order to better the view from his window was a good sign for investors.

Since that time, the S&P 500 has gained 7%. For the average investor that would normally be a great year. Data compiled by the St. Louis Fed shows that the average compound rate for the market in the decade ending last year was 7.02%.

That’s why Steve’s decision to buy a new Infiniti sedan is so important for the market – and for the U.S. economy.

The spinoff benefit from new car sales is huge.

Today’s new vehicles are essentially innovation on wheels. Take a car or truck a part today and you find a bevy of semiconductors, advanced sensors, sophisticated in-dash multi-media “infotainment systems,” not to mention GPS and blue-tooth integration with your mobile device.

Truth be told, Steve’s decision to get a new car is part of a huge national trend.

Auto analyst J.D. Powers & Associates notes that the U.S. car market saw $1 billion in sales every single day in November. The industry’s $30 billion cash inflow was up 10% from last year and its sales for the month were a record.

Thanks in part to “Black Friday” sales incentives – but also fueled by intriguing new models – American auto sales zoomed to an unexpectedly high annualized selling rate of 16.4 million in November. That was well ahead of the 15.3 million estimated in October, according to Autodata.

In a conference call with analysts and journalists, General Motors Chief Economist Mustafa Mohatarem said that a stable labor market, stable oil prices and record household net worth numbers contributed to the increase.

Expect car sales to remain strong for some time to come: My buddy Steve had been keeping his aging Nissan truck running by spending way too much money at the repair shop.

And many other Americans are doing the same thing: Research firm Polk notes that the average age of cars on the road today is an exceptionally long-of-tooth – 11.4 years old.

Electronic Gadget Sales Are Zooming

Gadgets are luxury items – and purchases soar when consumers are confident.

That’s what we’re seeing now. Apple Inc. (Nasdaq: AAPL) shares have surged nearly 40% since June, is having a great holiday season, and will enter the New Year with enormous momentum behind it.

Apple sold a record 9 million iPhones in a single weekend when two new versions launched in September. If my recent visit to a local Apple store is any indication – and I think it is – Apple will enjoy a great Christmas and an even better New Year.

There’s also the videogame sector, which is benefiting in a big way from having two new gaming systems introduced in November. The Sony Corp. (NYSE ADR: SNE) PlayStation 4 and the Microsoft Corp. (Nasdaq: MSFT)Xbox One are both new to the market this year.

Respected market researcher Gartner says the global video market will hit $93 billion this year, up nearly 18% from $79 billion last year. And there’s still more growth ahead: Gartner is forecasting another 19% increase by 2015 when the sector – computer and smartphone games, software titles and the actual gaming consoles – will reach $111 billion in sales. Consoles still rank as the largest segment of the market with projected 2013 sales of $44.3 billion – or roughly half the entire industry.

When folks feel secure – as these statistics and anecdotes seem to show – they buy more “stuff.” That’s bullish for corporate profits – and for stock prices.

Consumers are also more willing to invest when they feel flush, funneling liquidity into stocks – also bullish.

I’m very optimistic about the overall stock market. And, as is usually the case, the tech sector will continue to lead the way. Biotech, Big Data and Cloud Computing firms will also increase sales, profits and stock prices next year.

So let’s talk about a great profit play that I believe will benefit from all we’ve talked about here today. It’s a small firm, meaning the risk will be higher than normal. But the company’s high-growth rate, and ability to generate profits means this $23 stock will have a lot of running room in 2013.

Cashing In

The company in question is Ambarella Inc. (NasdaqGS: AMBA), a nimble small-cap firm that makes semiconductors for video compression and image processing. The company’s chips are used in high-definition (HD) video cameras for sports and security, as well as in digital still cameras and automotive video recorders.

The company recently introduced a new chip for the consumer digital video market for what are called “4K cameras,” which have four times the resolution of today’s HD video cameras.

With a market cap of $652 million, Ambarella has increased earnings per share (EPS) by 27% over the past three years. At that rate, earnings — and the company’s stock price – could double in less than three years.

Stocks aren’t the only investment that I’m watching.

In fact, I’ve got my eye on a phenomenon that is white-hot right now.

I’m referring to “Bitcoins.”

If you’ve been following the headlines about bitcoins of late, you know that the “virtual currency” has soared from $131 to $1,150 in just the past two months – a return of 778%.

It’s one heck of a story.

And I’ve got an amazing way for you to learn all about it. Take a look here and you’ll see what I mean.

Source :http://strategictechinvestor.com/2013/12/psst-heres-my-stock-market-forecast-for-2014/

Money Morning/The Money Map Report

©2013 Monument Street Publishing. All Rights Reserved. Protected by copyright laws of the United States and international treaties. Any reproduction, copying, or redistribution (electronic or otherwise, including on the world wide web), of content from this website, in whole or in part, is strictly prohibited without the express written permission of Monument Street Publishing. 105 West Monument Street, Baltimore MD 21201, Email: customerservice@moneymorning.com

Disclaimer: Nothing published by Money Morning should be considered personalized investment advice. Although our employees may answer your general customer service questions, they are not licensed under securities laws to address your particular investment situation. No communication by our employees to you should be deemed as personalized investent advice. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication, or after the mailing of printed-only publication prior to following an initial recommendation. Any investments recommended by Money Morning should be made only after consulting with your investment advisor and only after reviewing the prospectus or financial statements of the company.

Money Morning Archive

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules