Bob Janjuah: The S&P Will Rally...Then Collapse To 1,000 By The End Of The Year

nomura bob janjuah

Photo: The Globe and Mail

Bob Janjuah, Nomura’s famously bearish strategist, has some good news and bad news.He just wrapped up an interview with The Globe And Mail.

The Good News

Janjuah forecasts a near-term rally in the stock market.  He had two main reasons.

“Sentiment has gotten very, very bearish,” he said.  “Sentiment is at an extreme.”

But more bullish than that is the bearish sentiment toward Greece.

“There seems to be an expectation that Greece is suddenly going to exit the euro next week,” he said.  “It seems to us that this is not correct.”

Janjuah didn’t say specifically how much higher this would send stocks.

The Bad News

Janjuah notes that there will be more dovish signaling and monetary easing from the world’s central banks.  He thinks we’ll eventually get a new “Operation Twist” type program from the Federal Reserve and some sort of deposit insurance scheme from the European Central Bank (ECB).

Again, these are bullish stock market drivers in the near-term.  But they will also be the cause of the stock market collapse.

“None of these fixes are really fixes,” he said.

Once the jig is up, stocks will tumble.  Janjuah thinks stock could fall all the way to 1,000 by the end of the year.

Here’s the slide the The Globe And Mail ran while Janjuah spoke.

bob janjuah

Photo: The Globe and Mail

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