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NEW YORK (CNNfn) - Highly respected Wall Street guru Abby Joseph Cohen, co-chair of Goldman Sachs' investment policy committee, said Tuesday the U.S. stock market will perform better than she had expected earlier this year.
Less than two months after she put a "conservative" 8,700 estimate on the Dow industrials, Cohen raised the bar to 9,300, citing lack of inflation threats for the U.S. economy, a positive outlook for corporate profit growth, and expectations for a strong performance by the United States on the global economic front.
On Monday, the Dow broke the 8,700 barrier, closing at a record 8,718.85.
"There is no recession in our new forecast horizon, nor is inflation likely to be problematic," Cohen said in a research paper.
"The principal conclusion is that we expect profit growth to continue through our new forecast horizon," she said.
In early February, Cohen warned the major damage from the Asian crisis will be felt by U.S. companies in the first half of the year although most of the scars would heal eventually. In her latest outlook on the market, Cohen did not mention Asia. Instead, she envisioned "strong U.S. performance in the global economy."
Cohen raised her year-end forecast for the S&P 500 index to 1,150 from 1,075, and said the Nasdaq Composite would now reach 1,900 by the end of December, up from her previous estimate of 1,776. On Monday, both indexes exceeded Cohen's Feb. 2 predictions. 
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