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The S&P 500 will hit a fresh all-time high in 2024, according to Bank of America.
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“We are past maximum macro uncertainty,” a team led by Savita Subramanian said in a research note last week.
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Wall Street strategists have turned bullish on the benchmark index, which has racked up impressive gains this year.
The S&P 500 will charge to fresh all-time highs in 2024, Bank of America has predicted, joining other big Wall Street names in forecasting a strong year for stocks.
In a research note published last week, strategists said they’re expecting the benchmark index to trade at 5,000 points at year-end.
That’s 10% above the level the S&P 500 was at as of Tuesday’s closing bell, and well clear of its current record high of 4,768 points, set in January 2022.
“We forecast 5,000 by year-end 2024 for the S&P 500,” a team led by Savita Subramanian wrote in the note, which details the bank’s stock-market outlook for 2024.
Stocks have had a strong 2023, defying gloomy predictions from several market gurus. The S&P 500 has climbed 19% year-to-date, while the Nasdaq Composite is up 36% and the Dow Jones Industrial Average has added 2,300 points over the same period.
Equities have rallied this year despite a surge in global tensions, with wars raging in Ukraine and the Middle East.
They have also weathered the Federal Reserve’s aggressive monetary-tightening campaign, which has lifted interest rates from near-zero in early 2022 to around 5.5% in a bid to tame inflation.
Many traders are now expecting the central bank to start reducing borrowing costs next year – but stocks should be in good stead even if it doesn’t, according to Subramanian’s team.
“We are past maximum macro uncertainty,” they wrote. The market has absorbed significant geopolitical shocks already and the good news is we’re talking about the bad news.”
“We’re bullish not because we expect the Fed to cut, but because of what the Fed has accomplished,” the strategists added. “Companies have adapted to higher rates and inflation.”
Like Subramanian, BMO’s Brian Belski, Deutsche Bank’s Binky Chadha, and RBC Capital Markets’ Lori Calvasina have also predicted that the S&P 500 will soar to a new record next year.
Wall Street’s bull case is based around the idea that the Fed is close to achieving a so-called “soft landing” for the economy, which refers to the scenario where inflation falls in line with its 2% target level without a slump in growth or a surge in unemployment.
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