Market Forecast Update: May 31, 2013

I ran my stock market forecasting models updated for the end of May.  Despite the strong performance of the U.S. market this month, the new forecast is even rosier than the numbers as of the end of April.

Probable market gain: 12%

Probability of at least breaking even: 83%
Probability of an 8% dip along the way: 50%.

Statistically the stock market tends to be weak over the second half of the year, but my models say that probably will not be true this year. Why?

1: The economy is still under-performing – that leaves room for improvement.

2: Leading economic indicators are very slowly rising.

3: Recession probabilities are low and still falling, mainly because the Federal Reserve is still pushing down interest rates.

Here is a PDF of my full market report at scribd.com
http://www.scribd.com/doc/145298705/TomT-Stock-Market-Model-2013-05-31