Steve Leuthold, who back in March publicly and loudly called the market bottom and said talk about another depression was nonsense and that the market would reflect this in the near future, predicts the Standard & Poor’s 500 Index will end 2009 at 1,200 points and jump to 1,350 next year.
The 71-year-old investor, whose Leuthold Core Investment Fund has beaten 95% of its rivals in the past five years, joins Byron Wien, hired as a strategist by Blackstone Group (NYSE:BX) in August, in predicting that the S&P 500 will complete a 77% upside from its March low on Dec. 31.
“The market psychology is right,” Leuthold, who manages $4 billion, said in a Bloomberg telephone interview yesterday. “The market’s turned up before the economy did. Now, the economy is improving. It might be a little better than most think..”
When asked about S&P’s 2.6% decline yesterday (Oct.1) — the steepest since July 2 — Leuthold said he wasn’t really too concerned about a minor move like this, and considered it premature in taking defensive actions at these levels.
Leuthold also said it may take five years before the S&P exceeds its October 2007 record of 1,565.15.