Citigroup forecasts for the S&P 500: Base case of 6500. Bull case 6900. Bear case 5100.

This from Citi comes by way of a Dow Jones / Market Watch piece (could also be gated) – briefly:

• Citigroup forecasts modest positive aspects for the S&P 500 with a base case of 6,500, a bull case of 6,900, and a bear case of 5,100.
• Excessive trailing price-to-earnings (P/E) ratios, at their loftiest ranges in 40 years, pose a threat to returns and enhance volatility.
• Optimistic fundamentals, synthetic intelligence developments, and productiveness positive aspects are anticipated to assist the market.
• Confidence in long-term progress stays, however “elevated and unattainable” progress expectations mood optimism.
• Whereas large tech valuations are excessive, the remaining 493 S&P shares additionally commerce at their highest 20-year ahead P/E ranges.
• Citi’s Levkovich Index (previously the panic/euphoria index) signifies a euphoric investor section, akin to the Tech Bubble and post-pandemic rally.
• Historical past means that ranging from such excessive valuations typically results in decrease median returns and better draw back dangers.

This text was written by Aaron Cutchburt at www.ubaidahsan.com.



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