NEW YORK ( TheStreet) -- Influential hedge fund manager David Tepper appeared on CNBC Tuesday saying that the markets can still go higher even in the absence of a larger budget deal in Washington given that the fiscal overhang is increasing the odds that the Federal Reserve will prolong its aggressive stimulus measures by several more months than previously forecast.
"That's definitely ... going to be a push-up to markets," Tepper, the founder and head of Appaloosa Management said on CNBC's "Squawk Box" this morning. Tepper said that the duration of a prolonged bond buying remains elusive though. "Will the Fed taper in March or June? I don't know now," he added.
Tepper offered his intermediate projections on the stock market as Senate leaders appeared poised to offer an agreement that would raise the country's $16.7 trillion debt ceiling until mid-February. He said that a very powerful surge would have been a possibility if they'd been working on a long-term fiscal plan for the U.S. rather than a short-term fix.
"It looks like they may have a relatively short-term deal, which is going to not create the kind of confidence you might quite like," Tepper explained. "If you get a big broader budget deal, that would be great and markets could fly."
-- Written by Andrea Tse in New York
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