Daily Data Flow: U.S. Stocks Up; Volker Rule; Goldman Sachs Predictions

U.S. Stocks Climb Amid Optimism Over Budget Negotiations (Bloomberg)
U.S. stocks rose, sending the Standard & Poor’s 500 Index higher for a second day, amid investor optimism that lawmakers will reach a resolution in federal budget negotiations. “There’s going to be increasingly divisive negotiations that might shake the market’s confidence a bit,” Jeffrey Kleintop, chief market strategist at LPL Financial Corp. in Boston, which oversees $350 billion, said. “We might see a lot of volatility.”

Volker Says Rule Is Already Changing Wall Street (CNBC)
In a rare interview, former Fed Chairman Paul Volcker told CNBC that his namesake rule has already changed the way Wall Street does business, despite the delays in crafting the final draft of the rule, which regulatory officials now say won’t happen until next year. “Banks have stopped their straightforward proprietary trading operation, and they’ve largely cut back on their hedge funds and equity funds,” Volcker said in the interview broadcast Thursday. “And as the managements and the directors finally understand that ‘yes, this is a law that has to be followed,’ they’ll be able to manage their trading desks in what I think is an effective way.”

Goldman’s Five Strategies for 2013 and S&P 500 Targets (Marketwatch)
Goldman Sachs rolled out its crystal ball on Thursday, laying out its stock market targets, investment ideas and top market themes for 2013. Among their big predictions, Goldman is targeting a 12-month target of 1,575 for the Standard & Poor’s 500 index, which they say implies a 12% potential return on stocks — corporate fundamentals will support continued profit-cycle expansion.