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Cohen expresses optimism
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March 18, 1999: 8:09 p.m. ET
Goldman Sachs prognosticator says stocks should continue to climb
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NEW YORK (CNNfn) - One of Wall Street's leading market gurus Thursday said investors can expect corporate profits to rise and the stock market should continue to climb.
Abby Joseph Cohen, co-chair of Goldman Sachs' investment policy committee, told the Moneyline News Hour with Lou Dobbs that economic and corporate performance should continue to stimulate the stock market.
"We had expected that 1999 would be a good year for the economy, profits would grow and inflation would stay under control," Cohen said. "If that's right, 2000 should be yet another year of this economic and profit expansion and stocks should continue to rise."
Last year, Cohen noted that a market downturn would come at the most unexpected moment. Although a Dow 10,000 milestone could be considered such a moment, Cohen said current fundamentals suggest the market will continue going strong.
"At some point, there may be economic or performance deterioration," she said. "That would set a precondition for the market to do not quite so well, but we don't see that on the horizon. If anything, we think corporate performance in 1999 will be somewhat better than it was in 1998 in a whole host of different industries."
While much of the investment community has trumpeted the significance of a Dow 10,000 close, Cohen said all the hoopla over the milestone may be a bit overblown.
"I think Dow 10,000 may be something of an anticlimax," she said "For me, the real story is that stocks have risen 35 percent or better since last August and September." [198K WAV] or [198K AIFF]
Cohen, who last year forecast the Dow Jones industrial average would close 1999 at 9,850, declined to give a revised forecast for the year ahead of her firm's official report due out later this month. However, she said it was possible for the Dow to end this year above 10,000.
"Several weeks ago, we advised our clients… to recognize those 35-percent gains [in stock prices] were not going to be easily repeated and to take a little bit off the table in the stock market," she said. "Can stock prices continue to rise? Absolutely, but we think at a more moderate pace." 
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