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He predicted an earnings drag in 2012 would lead the S&P 500 to close the year at 1,167. Parker was correct about the bearish earnings call, but he underestimated the power of the Federal Reserve and its ability to juice markets higher.
Earlier this year, Parker wrote, “We had though that most investors would decide this ‘heroin’ wasn’t worth it. We forgot what it means to be an addict. We were wrong and clearly mis-calibrated the strike price of the Fed ‘put.’ Maybe not ultimately wrong, and maybe not even by year-end, but for sure over the past few months we were wrong about the demand for this kind of artificial stimulus.” Parker has a year-end 2013 S&P 500 price target of 1,434, with bull and bear targets of 1,733 and 1,135, respectively.
As of November 23, about 97 percent of S&P 500 companies had reported third quarter earnings. Overall, the firms only showed a 0.1 percent gain in profit growth, according to Investor’s Business Daily and data from Thomas Reuters. Meanwhile, revenue growth sank 0.8 percent. It was the weakest growth for profit and revenue since the third quarter of 2009.
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