I picked up something from Yahoo Finance for those looking for reasons to invest their hard-earned wealth next year. The stock market has had a stellar run in 2023, and the equity strategy team led by Savita Subramaniam at Bank of America expects another strong year in 2024 will send the S&P 500 to a record high of 5,000. I get it. Things are good. Invest accordingly.
While some may see her bull case as “too much” (not me), some investors are willing to listen to Subramanian’s prediction given her track record so far this year. Even her colleagues at Bank of America are not bullish on the stock market’s future prospects.
Here is a section:
In a note to clients published Tuesday, Savita Subramanian and her team at Bank of America argued the coming year will be a “stock picker’s paradise” as markets move past the “maximum macro uncertainty” investors faced this year.
“The market has absorbed significant geopolitical shocks already and the good news is we’re talking about the bad news,” the firm wrote. “Macro signals are muddled, but idiosyncratic alpha increased this year. We’re bullish not because we expect the Fed to cut, but because of what the Fed has accomplished. Companies have adapted (as they are wont to do) to higher rates and inflation.”
The firm’s forecasted year-end target for the S&P 500 implies the benchmark index will rise about 10% from current levels. The firm had a year-end price target for 2023 of 4,600 on the S&P 500. Despite mounting headwinds such as a weakening consumer and fears that the lagging impacts from the Fed’s interest rate hikes could be larger than expected, Bank of America sees earnings growing 6% in 2024 to USD235 per share.