Elaine Garzarelli Sees 15% Upward Move in S&P 500 (XLI, XLY, XLK)

Elaine Garzarelli was the Market Monitor on the Nightly Business Report on Friday. Back in the 1980's Garzarelli was an extremely influential stock market analyst, after correctly predicting the stock market crash of 1987. Elaine Garzarelli was voted Wall Street's top Quantitative Analyst for 11 years in Institutional Investor, magazine's poll. She is President of Garzarelli Capital. Elaine Garzarelli who appeared on the show back in March, is still bullish. I wrote about her appearance then here at Benzinga. The market hit a high in May and hasn't been able to reach new highs. Garzarelli said that is typical: “Usually after the initial surge in a new bull market -- the market went up 70 percent for the S&P 500 after a recession -- the usual case is that the stock market goes into a trading range for six to 12 months. So that is normal. And every time that happens, there is talk about double dips. And I don`t see a double dip, therefore I think we`re going to come out of this trading range, which has been 1050 to 1150 for five or six months.” Elaine Garzarelli's indicators are flashing bullish signs and she anticipates a 15% move in the S&P 500: “Well, my indicators have gone up from 67 percent to 82 percent which is quite bullish. The 100 percent is the maximum, so 82 percent is fairly good. Thirty percent would be a new bear market. I have earnings for 2011 at 86. The consensus now is at 95. So I`m way below the consensus and with the P/E normal of about 15, that gets us to 1300 on the S&P 500. What`s that, 15 percent. That is only based on `11, not based on 2012 earnings.” Garzarelli is still recommending some of the same ETFs she recommended back in March. She likes, Industrial Select Sector SPDR Fund, XLI. She recommended XLI: “Because the growth in the economy in 2011 and 2012 are going to be in four areas, going to be consumer durables, business equipment spending, exports and residential construction. And they`re still going to have a very, very large amount of industrial purchases and that`s going to be because of exports and business replacement equipment. So I still like XLI. Even though it`s moved a bit, I think we can do two times better than the gain in the S&P 500.” Garzarelli also likes SPDR Consumer Discretionary Select Sector ETF XLY. Referring to consumer demand and XLY she said: “Basically replacement demand and paying off debt gives you more income and more faith that things will get better and it is time to spend again. I don`t know how many of my friends just bought new TV sets and cars. There is a strong demand for automobiles in next year and into 2012 as well for housing. McDonald`s is in there, Disney, Home Depot, Ford.” Garzarelli also recommended SPDR Technology Select Sector ETF XLK. See 4 Strong Buys here for free.