(Bloomberg News) The $1 trillion erased from U.S. equities in May has left bulls from Byron Wien to Laszlo Birinyi and Jonathan Golub unbowed in their predictions that the rally in shares will continue.

Blackstone Group LP's Wien, who foresaw the bear market's end in 2009, said the Standard & Poor's 500 Index's biggest monthly retreat since September lowered investment sentiment so much that it's safe to buy.

Birinyi, president of Birinyi Associates Inc., and Golub, the chief U.S. market strategist at UBS AG, say the largest first-quarter rally in 14 years left shares due for a decline and that gains will resume.

For a third straight year, losses in May have heightened concern that the slowest U.S. recovery from any recession in seven decades is fizzling out. While the 6.3 percent decrease in the S&P 500 was enough for Birinyi to say he's "tempering" his enthusiasm, Wien said declining forecasts for economic growth have aligned investor expectations with reality and more disappointments are unlikely.

"The best time to buy stocks is when people hate them and they sure hate them now," said Wien, the New York-based vice chairman of the advisory services unit at Blackstone whose forecast that the S&P 500 would exceed 1,400 in 2012 came true on March 15. Blackstone has $190 billion under management. "Who would've thought that 2 percent growth would be impressive? But that's what we have. Everybody's bearish."

Outlook Worsens
Stocks rose last week, with the S&P 500 climbing 3.7 percent to 1,325.66, after China cut interest rates and European Central Bank President Mario Draghi said officials stand ready to act should the region's growth outlook worsen. The increase trimmed the loss since the U.S. equity index reached its 2012 peak on April 2 to 6.6 percent. The gauge is up 5.4 percent for the year and 96 percent since reaching a 12-year low of 676.53 in March 2009.

Economists have pared 2012 forecasts for expansion in U.S. gross domestic product since last year. The world's largest economy will grow 2.2 percent, down from an estimate of 3.3 percent in February 2011, according to the median estimate of 93 economists surveyed by Bloomberg.

Wien, a senior strategist for Morgan Stanley and hedge fund Pequot Capital Management Inc. before coming to the world's biggest private equity firm, said the May selloff left investors with cash that will eventually come back to stocks.

Fund Withdrawals
Investors withdrew $7.2 billion from American equity mutual funds during the five days ended May 23 after $178 billion of outflows in the previous 12 months, data from the Investment Company Institute in Washington show.

Birinyi, an equities trader at Salomon Brothers Inc. in the 1980s, recommended buying shares at the beginning of May, saying rising bearishness was a sign they'd go higher. The 6.3 percent loss in the S&P 500 last month was the biggest decrease since September. He said in December 2008 that a bull market was beginning. An investor who bought the S&P 500 at the March 2009 low turned $10,000 into $20,984, including dividends.