Ed Yardeni has a strong bullish outlook on US equities, talks about the potential for a “red sweep”.
Some believe that the S&P 500 has the potential to soar up to 10,000 points, from the current 6,000 points level hit for the first time on Monday, November 11, 2024.
The milestone was reached thanks to a rally triggered by Donald Trump’s victory in the US Presidential Elections, which continued to boost U.S. stocks, pushing also the value of the Nasdaq Composite Index higher.
Amid widespread speculation about the coming weeks—particularly once the Republican leader assumes office and inaugurates the new U.S. administration— some still show an unwavering confidence in the S&P 500.
Ed Yardeni’s outlook: S&P at 10,000 points. Here’s when
Analyst Ed Yardeni has offered an exceptionally bullish forecast for the S&P 500, envisioning a scenario where the index reaches 10,000 points.
However, this target is not expected to be reached immediately; according to Yardeni, it could take until the end of the decade, or the early 2030s.
Before this ambitious goal, according to Yardeni, the index will reach other milestones: first, it will rise up to 6,100 points by the end of this year, then further jump to 7,000 points by the end of 2025.
The S&P 500 will then touch 8,000 points in 2026, and eventually hit 10,000 points by the end of the decade.
Yardeni explained his bullish outlook precisely with Donald Trump’s victory, in contrast to recent warnings from other experts urging caution towards Wall Street’s recent upward trend—popularly referred to as the “Trump Bump”.
The analyst’s forecast also contrasts significantly with the Goldman Sachs outlook, which was released well before Election Day.
Ed Yardeni explains his super bullish forecast with “Animal Spirits”
The expert attributed his confidence in the S&P 500 to the well-known Wall Street concept of “Animal Spirits,” a term coined by the economist John Maynard Keynes. It describes investors’ propensity to buy or sell assets, often in periods of economic stress or uncertainty, driven by the emotional climate of a specific historical moment rather than the intrinsic value of assets.
“Animal Spirits” has retained its original meaning, still referring to the set of psychological and emotional factors that influence investors’ choices in periods of intense volatility.
“Animal spirits are back.”
said Yardeni.
In a note written yesterday, Yardeni explained his view, stating that “investors focused on stocks are enthusiastic about the shift to a pro-business administration that aims to support tax cuts and deregulation” .
The euphoria, according to the analyst, will intensify in case of the red sweep in the United States—a Republican presidency bolstered by a GOP-controlled Congress.
But will the S&P 500 remain unshaken until 2030? Certainly, there will be moments when the Wall Street benchmark index reverses course.
“While we do not expect another bear market until the end of the decade, there will undoubtedly be some corrections along the way,” Yardeni wrote, concluding by acknowledging that such bullish sentiment also raises concerns for him.
Yardeni also raised his outlook for the 2026 operating EPS of S&P 500 companies, upgrading it from $300 to $320.
Original article published on Money.it Italy 2024-11-12 16:21:42. Original title: S&P 500 a quota 10.000 punti entro il 2030. La previsione “super bullish”
