2023-11-27 12:58:32
There are growing expectations that the S&P 500 stock index will reach a new record high within the next year. Deutsche Bank strategists set the most bullish targets on Wall Street.
The bank’s team, led by Binky Chadha, expects the S&P 500 to reach 5,100 by the end of 2024, regarding 12% above current levels, on the back of falling inflation and improving corporate earnings.
“Despite above-trend growth, core inflation has declined. If the decline continues, inflation might return to its pre-pandemic range without requiring a slowdown in growth,” Chadha and colleagues wrote in their report. Analyzed as “Deaf”. He also predicted that even if the economy were to go into recession, “the decline in stock prices would be small and temporary, as it is expected to be mild and short-lived.”
Most market forecasters failed to predict stock prices in 2023, but are increasingly optimistic regarding next year as investor sentiment improves and recession fears recede. RBC Capital Markets strategist Lori Karvasina and Bank of America’s Savita Subramanian both expect the S&P 500 to reach 5,000. The index hit an all-time high of 4,796.56 in January 2022.
Deutsche Bank’s Chadha expects corporate profits to rise by 10% in the event of a small, short recession. If gross domestic product (GDP) grows by 2%, profits will increase by 19%. Analysts expect profits to fall 0.4% this year and rise 11% in 2024, according to data compiled by Bloomberg Intelligence.
Chadha was one of the few strategists to correctly predict the S&P 500’s rise in the first quarter of this year. The index is currently trading above Chadha’s target of 4,500 by the end of 2023.
Original title:Deutsche Bank Expects US Stocks at Record High By End of 2024(excerpt)
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