As we navigate the second half of 2024, the S&P 500 continues its historic rally, prompting a flurry of price target increases from top Wall Street strategists. The optimism surrounding the market is driven by a confluence of factors, including the benefits of artificial intelligence (AI), consumer resilience, and expected Federal Reserve rate cuts.
Evercore ISI: Setting the Bar at 6,000
Julian Emanuel of Evercore ISI emerged as the most bullish forecaster on Wall Street with a year-end S&P 500 price target of 6,000, signaling a potential 7% upside for the index. Emanuel’s shift from bearish to bullish was underpinned by the AI revolution, robust earnings growth projections, consumer strength, and favorable macroeconomic conditions.
“The pandemic changed everything. Record stimulus, elevated household cash balances and low leverage support the consumer. Then came AI. Today, Gen AI’s productivity potential in every job and sector is inflecting. The backdrop of slowing inflation, a Fed intent on cutting rates and steady growth have supported Goldilocks,” Emanuel stated.
Oppenheimer and Yardeni Research: Bullish Perspectives
John Stoltzfus of Oppenheimer and Eric Wallerstein of Yardeni Research also raised their price targets to 5,900 and 5,800, respectively, citing the resilient US consumer and the substantial amount of sidelined cash awaiting deployment into equities. Stoltzfus emphasized that long-term investors are driving the market’s gains, while Wallerstein highlighted the impact of Federal Reserve rate cuts on fueling a stock market meltup.
Ned Davis, Goldman Sachs, and UBS: Upbeat Outlooks
Ned Davis Research, Goldman Sachs, and UBS revised their year-end S&P 500 price targets to 5,725, 5,600, and 5,600, respectively. The firms pointed to strong earnings growth, the absence of recession signals, and solid GDP forecasts as key drivers of their bullish outlooks. Goldman Sachs cautioned about potential concentration risks in mega-cap tech stocks and a modest slowdown in earnings growth, while UBS highlighted the positive trend in GDP forecasts and lowered recession risks.
Overall, Wall Street remains optimistic about the S&P 500’s performance in the remainder of 2024, with projections pointing towards continued gains supported by various fundamental and macroeconomic factors.