Wall Street strategists predict annual rise in US stocks next year
Wall Street strategists, who set aside rally expectations in 2023 but whose forecasts missed the mark, predict an annual rise in US stocks next year.
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Strategists at Bank of America Corp., BMO Capital Markets, and Deutsche Bank AG are among those expecting the S&P 500 Index to rise again next year, surpassing its record high from early 2022.
Less optimistic strategists at Goldman Sachs Group Inc. and Societe Generale also forecast that stock prices will rise slightly further by the end of 2024, even if they remain somewhat short of the previous peak.
These views mark a sharp departure from their forecasts a year ago, when most warned that higher interest rates would trigger a recession and cause the stock market to crash. The S&P 500 index defied all negative predictions in 2023, rising more than 18 percent amid ongoing economic momentum and an artificial intelligence craze that drove major gains in tech stocks.
This has led sell-side forecasters to remain more optimistic for next year, albeit with a more cautious outlook. According to data compiled by Bloomberg, the average target forecast points to a 3.5 percent increase in the S&P 500.
Binky Chadha of Deutsche Bank and Brian Belski of BMO, who were among the few to correctly predict the rise at the beginning of this year, forecast 5,100 points for the S&P 500, a 12 percent increase from Friday's close. Savita Subramanian of Bank of America predicts the index will end 2024 at 5,000. David Kostin of Goldman Sachs predicts the benchmark will remain at the 4,750 level next year.