Gazing in the rear-view mirror, the stunner of 2004 from a stock market perspective was Abby Joseph Cohen.
The perennially bullish market strategist for Goldman Sachs actually restored some of her lost credibility by finally getting it right - by predicting a positive year for the financial markets.
A year ago, Cohen predicted the S&P 500 index would end '04 at 1,250 points. She overshot her target by only about 40 points as the S&P was up more than 10 per cent.
Despite a year of market shocks, including skyrocketing oil prices, a rash of accounting scandals such as the one at Nortel Networks and shockwaves in the drug sector punctuated by Merck's recall of blockbuster drug Vioxx, the stock market showed uncanny resilience.
All major indices, including the S&P/TSX index, showed positive returns in '04.
What's not surprising is that Cohen is once again the most bullish among the cheerleaders - er, strategists - at major Wall Street firms, forecasting the S&P 500 to end the year at 1,325, which would be another gain of almost 10 per cent.
The median forecast of the major brokerages is for a four-per-cent rise in the S&P 500.
At the opposite end of the spectrum from Cohen is Gary Gordon of UBS Investment Research, who predicts the S&P 500 to end '05 at 1,150, which would be a 4.6-per-cent decline.
Gordon, who had also pegged the S&P for 1,150 in '04, expects disappointing corporate earnings to dampen stock market returns.
His major concerns are high corporate debt levels and the record trade deficit in the U.S.
We're not about to make a call on the markets - our crystal ball broke in 2001 - but here are some of the headlines we'd like to see in 2005:
* Abby Joseph Cohen Trips On Pom-Poms;
* CEO Resigns, Cites 'Business' Reasons;
* Nortel Shocks Street, Releases Earnings From New Millennium;
* Ex-Nortel Chief Frank Dunn Enrolls In Math Classes;
* WestJet CEO Clive Beddoe Resigns, Stock Jumps;
* Ex-Bombardier CEO Paul Tellier Named CEO of WestJet;
* U.S. Airways Apologizes To Disgruntled Holiday Travellers: 'Sorry, But Air Canada Taught Us Everything We Know';
* NHL Governors Fire Bettman, Distressed Union Boss Goodenow Resigns;
* Apprentice Fires Donald Trump;
* Trump Pens New Bestseller: Think Like An Egomaniac;
* Larry Ryckman Takes CFL By Storm, Buys Stampeders - Again;
* David Braley Sells B.C. Lions To Nelson Skalbania;
* Skalbania Flips Lions To Jimmy Pattison;
* Pain Drug DECREASES Risk Of Heart Attack;
* Beaten Drug Stocks Rally, Lead Markets;
* Angiotech CEO Bill Hunter Finally Gets Respect, Named CEO Of Year;
* Wall Street Analyst Issues Sell Recommendation, Straitjacket Ordered;
* Wall Street Analyst Downgrades Stock BEFORE It Tanks: Presses Stopped;
* Wall Street Cop Eliot Spitzer Probes Wall Street Janitors;
* TSX Comes To Senses By Slashing Silly Dot-SV Ticker Symbols, Traders Pop Champagne;
* Martha Stewart Changes Name - And Broker;
* Alberta Hikes Minimum Wage;
* BC Ferries Boss David Hahn Formally Introduced To Local Shipbuilders;
* Shaw Communications CEO Jim Shaw Refuses Another $4M Bonus, Cites Lousy Stock Performance;
* Canadian Dollar Trades At Par with U.S. Dollar;
* Yanks Change Name Of Currency To Peso;
* U.S. Fed Reserve chairman Alan Greenspan Retires, Cancels Canadian Vacation, Cites Currency Exchange Rate;
* Gold Hits $800 US Per Ounce;
* Gold Bugs Predict $8,000 US Gold By Year End;
* Starbucks Lowers Coffee Prices;
* CEO Comes Clean: 'I'm Creating Value For Myself';
* Oil Company Shocks Street, Does Not Convert Into Royalty Trust;
* Hawker Resources CEO David Tuer Pens Blockbuster Book: How To Decrease Shareholder Value In A Raging Energy Bull Market;
* Conrad Black Issues Statement, Nobody Bothers To Read It;
* Berkshire Hathaway Chairman Warren Buffett Confesses: 'I'm A Day Trader, Buying And Holding Is Dumb';
* Microsoft Chairman Bill Gates Dumps Berkshire Shares;
* ATCO Boss Nancy Southern Does Interview, Media Wag Faints;
* B.C. Forestry Minister Mike de Jong Takes Off Gloves In Softwood Lumber Fight With U.S.;
* Mutual Fund Company Sets New Standard, Waives Fees For Under-performing TSX Index;
* Company Cuts Earnings Forecast, CEO Cuts Stipend;
* Junior Mining Company Says It Is NOT Pleased To Release Exploration Results;
* Canada Escapes Dark Ages, Creates Single Securities Regulator;
* American Class-Action Lawyer Shocks Investment World: 'I'm NOT Suing!';
* Internet Spam Artist Caned.
* SAGE WORDS: "People, even more than things, have to be restored, renewed, revived, reclaimed, and redeemed; never throw out anyone."
- Actress Audrey Hepburn
HOT STOCK: Centurion Energy International
TSX:CUX $15.14
Up $12.84 (+558.3%)
International oil and gas plays were all the rage of oilpatch punters in 2004 and Centurion paved the way with its star-studded properties in Egypt and Tunisia. Yet, the party may not be over as some experts have been predicting even bigger things to come for this Calgary-based company in 2005. In Egypt, Centurion scored a perfect success record, going four-for-four with its first four wells of a 21-well drilling program.
HOT STOCK: Tundra Semiconductor
TSX:TUN $13.20
Down $13.75 (-51.0%)
Averaging down can be hazardous to the health, especially if you were a Tundra shareholder in 2004 bent on lowering your average cost. Stock in the chipmaker skidded for almost the entire year and, judging by the latest guidance from the Ottawa company, the worst may not be over. After recently reporting $22.7 million in revenue for the first fiscal quarter (through Oct. 31), Tundra provided guidance for the second quarter (ending Jan. 31) of $16-$18 million. CEO Jim Roche characterized that dismal forecast as a “speed bump.” Mmmm, wonder if that's a Hummer he’s driving?
(Gyle Konotopetz can be reached at gyle@businessedge.ca)
