2023-06-11 20:30:00
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Leek Chuck Mikolajczak
NEW YORK (Reuters) – Goldman Sachs (NYSE:) on Friday raised its year-end price target for the index to 4,500 from 4,000, citing a widening of the year-to-date rally that has been led only by some mega-cap stocks.
Goldman’s chief US equity strategist, David Kostin, said in a note to clients that the company’s forecast for earnings per share of $224 for the S&P 500 in 2023 is unchanged and assumes a soft landing for the US economy. economy, as the economic team projects a probability of only 25% of recession in the next 12 months.
While the current price/earnings ratio of 19 is “higher than we expected, led by some mega-cap stocks”, Kostin said the “combination of a slowdown in , healthy growth and heightened concentration in the market indicates that the current multiple may persist”.
Kostin cites an unexpected slowdown in growth and persistent inflation prompting a shift towards a more “hawkish” (aggressive against inflation) stance on the part of the . The Fed is widely expected to keep rates steady at its policy meeting next week.
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