Surprise: It’s an up year for stocks

He thinks the S&P 500 could end 2012 at 1,500, up 19 percent for the year. It closed Friday at 1,362.

If the worst of Europe’s debt crisis is indeed over, Mr. Paulsen’s target doesn’t seem so bullish. But stocks have rallied on hopes of a permanent fix before, only to be dashed on news of rising Italian borrowing costs, scary Greek elections and teetering Spanish banks. And you can’t rule out the occasional unhappy surprise at home, either.

On May 10, for instance, JPMorgan Chase announced that it had lost at least $2 billion on a complex derivatives bet. A little more than a week later, Facebook’s debut on the public markets was marred by technical glitches, a delayed open and a sinking stock price.

“You can’t build wealth without volatility,” says Doug Cote, chief market strategist for ING Investment Management, who says he’s been buying stocks. He calls dips in the prices lately “an extraordinary opportunity.”

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