Brokerages have increased their year-end targets for the S&P 500, driven by expectations of a “soft landing” for the economy and the likelihood of the Federal Reserve cutting interest rates this year. Major banks such as Goldman Sachs, UBS Global Wealth Management, and Barclays have set high targets for the S&P 500, reflecting their positive economic growth forecasts. For instance, Goldman Sachs and UBS Global Wealth Management both forecast the S&P 500 reaching 5,200, while Barclays aims for 5,300. These projections are supported by anticipated interest rate reductions and stable economic growth, with the U.S. 10-year yield targets ranging from 3.75% to 4.75%.
The banks also provided their forecasts for inflation and real GDP growth for 2024. U.S. inflation is expected to trend downward, with Goldman Sachs and J.P. Morgan predicting both headline CPI and core PCE inflation at 2.5%. Real GDP growth projections for the U.S. vary, with Goldman Sachs being the most optimistic at 3.1%, while Citigroup expects a more modest 1.0% growth. Globally, economic growth is anticipated to be around 2.6% to 3.1%, with significant growth expected in China and India. These forecasts highlight a generally positive outlook, although regional variations and potential risks remain.