Expectations Surpassed as Share Prices Set to Rise Significantly This Year

Posted on February 19, 2024February 20, 2024 by admin

Goldman Sachs, a leading investment bank, has revised its forecast for the S&P 500 Index. The new projection indicates a notable increase in the index’s potential performance.

As reported by Bank of America, Goldman Sachs is now predicting that the S&P 500 Index could reach 5,200 points by the end of the year 2024. This news has been picked up and reported by international news agencies including Bloomberg and Reuters.

The new forecast indicates a potential rise of approximately 4 percent in the S&P 500 Index when compared to its closing prices recorded on the previous Friday.

In the bank’s preceding estimate, the S&P 500 Index, which tracks the performance of the 500 most valuable companies in the US, was projected to reach a level of 5,100 points by the year’s end. To put this in perspective, the forecast in December had the index pegged at 4,700 points.

Furthermore, Goldman Sachs on Friday predicted an eight percent increase in the operating profit of companies listed under the S&P 500 Index. The improved outlook of the US economic landscape formed the basis of this assessment.

David Kostin, one of Goldman Sachs’ chief strategists, provided further insight, stating, “Our expectations of strong global GDP growth and a slightly weaker dollar will bolster earnings per share, while lower interest rates and lower oil prices may pose slight challenges.”

Kostin anticipates that the largest technology companies, often referred to as the Magnificent Seven (Amazon, Apple, Alphabet – Google’s parent company, Nvidia, Microsoft, Meta Platforms, and Tesla), will significantly contribute to an increase in operating profits in the S&P 500 sector.

It’s worth noting that the S&P 500 Index crossed the 5,000 point mark for the first time in early February.

The S&P 500’s rise has been primarily driven by large technology companies. So far this year, the index has recorded a nearly 5 percent increase. Since the start of 2023, the index has surged by more than 30 percent.