tl;dr
Goldman Sachs predicts the S&P 500 will reach a new all-time high of 6,500 within 12 months, up from their previous target of 6,200, driven by improved market conditions and a trade deal between the US and China reducing tariffs. The agreement has eased recession fears and market uncertainty. Howeve...
Goldman Sachs forecasts the S&P 500 to reach a new all-time high of 6,500 within 12 months, up from their previous target of 6,200. This optimistic outlook is driven by improved market conditions and a significant US-China trade deal that reduces tariffs on both sides.
The trade agreement has eased fears of a recession and decreased market uncertainty, providing a strong backdrop for the stock market rally. Treasury Secretary Scott Bessent highlighted the agreement as a major step, noting a 90-day pause and a substantial reduction in reciprocal tariffs by 115%.
Despite the long-term bullish view, Goldman’s strategists express caution in the near term. They warn that after the S&P 500 recently hit their three-month target of 5,900, momentum may slow. Current market conditions do not support a sustained rebound, and already optimistic pricing of economic growth, coupled with uncertainties around economic and earnings slowdowns, could cap equity multiples in the coming months.
As of Tuesday’s close, the S&P 500 was trading at 5,886, signaling a promising yet cautious path ahead. Investors are advised to weigh these dynamics carefully as the market continues to react to global economic developments and policy changes.