Bank of America raises S&P 500 year-end target
Even stock market bears have plenty to point to as fears of another Fed rate hike and consumer slowdown send stocks lower as 2023 draws to a close.
But Savita Subramanian, head of US equity and quantitative strategy at Bank of America, has a simple message for investors. The legend of reggae music“Don’t worry, be happy,” Subramanian wrote in a new note to clients on Wednesday.
Bank of America raised its year-end target for the S&P 500 to 4,600 from 4,300 in the note. That now reflects about 3% of S&P 500 levels.
“Recession averted,” says the consensus economist, but a new bearish narrative around stocks has emerged, writes Subramanian. “The net message of our five target indicators is aggressive, bringing a new 2023 year-end target of 4600, up from 4300.
Bank of America’s 4,600 S&P 500 call is among the highest among Wall Street strategists tracked by Yahoo Finance. According to BofA research, this is a good sign.
“Stocks Decline Expected Growth But Respond to Surprises” Suramanyan.
In the year Based on data dating back to 1999, BofA averaged the S&P 500’s year-end target by the end of August, typically yielding a 5% return through the end of the year. On the rare occasions that strategists saw the benchmark index decline in late August, the S&P 500 rose each time and boasted better average returns than strategists had predicted for the S&P 500’s gains.
At the end of August this year, strategists’ S&P 500 targets were down 2%. So even as macro headwinds emerge, there may be another surprise spot for the upside.