The bull market is poised to extend through 2025, boosted by solid demand for stocks from investors as well as strong corporate activities, such as buybacks and other spending, according to Deutsche Bank, which is calling for the S & P 500 to rise as high as 7,000. Binky Chadha, chief global strategist at Deutsche Bank, set a year-end 2025 target for the S & P 500 of 7,000, which would translate into a 17% gain from current levels. “We see robust equity (and bond) inflows continuing, boosted by strong risk appetite,” Chadha said in a note to clients. “We see S & P 500 buybacks rising from an annual run rate of $1.1 trillion currently to about $1.3 trillion next year, rising in line with earnings. We see the demand-supply backdrop for U.S. equities remaining solid even with conservative assumptions, pushing the S & P 500 to around 7000 next year.” .SPX YTD mountain S & P 500 The S & P 500 is looking to wrap up a strong 2024 with a bang, thanks to optimism toward President-elect Donald Trump ‘s market-friendly policies. The benchmark just hit another intraday record Monday, bringing its November gains to about 5% and 2024 return to 25.5%, excluding reinvested dividends. For 2025, Deutsche Bank sees stronger growth in the U.S. on the back of potential tax cuts and a deregulation push under the incoming Trump administration. However, the German bank cautioned that Trump’s protectionist trade and immigration policies could also threaten its bullish thesis. “The main downside risks are more likely to emerge if greater weight is put on aggressive trade and immigration policies,” Deutsche Bank said. “This could be more negative for growth and push up inflation. That would lead the Fed to cease the [interest rate] cutting cycle and possibly even contemplate restarting rate increases which would likely put upward pressure on bond yields.” Deutsche Bank is not the first Wall Street firm to release a rosy equity outlook after the presidential election. UBS recently said that what it called a “Roaring 20s” period for stocks will continue , seeing the S & P 500 rising again next year, to 7,000 in its most bullish case. Goldman Sachs’ 2025 forecast calls for stocks to gain 11%.
https://www.cnbc.com/2024/11/25/deutsche-bank-sees-the-sp-500-hitting-7000-amid-rising-risk-appetite.html
