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Analysts who correctly predicted 2023 rally give their S&P 500 forecast for next year

Published Dec 04, 2023 08:23AM ET
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© Reuters. Analyst who correctly predicted 2023 rally gives his S&P 500 forecast for next year
 
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The S&P 500 is having an incredible year. The benchmark U.S. stock market index is up 19.7% on the year as bulls test the resistance around 4600.

For Stifel’s analysts, known for accurately predicting the rally in the first half of 2023, this rally has largely played out.

The analysts upgraded their mid-2024 price target for the S&P 500 to 4650 from 4400 previously.

“We see the S&P 500 topping around 4,650 into mid-2024 as mega-cap Growth loses some ground to Cyclical Value (Banks, Capital Goods, Energy, Financial Services, Insurance, Materials, Real Estate and Transportation), as a result of economic growth, inflation and Federal Reserve tightness all proving resilient,” the analysts said in a note.

The strategists expect the Federal Reserve to start cutting rates not before the second half of the next year.

“The Fed holds the key to “double-dip” risk in 2H24,” they added.

They also forecast that inflation-adjusted returns on the S&P 500 will remain flat for the next decade.

“We expect a range-bound S&P 500 in real terms to continue into the early 2030s.”

“Such an environment of reflationary economic growth (we expect moderately reflationary growth in the 2020s) historically benefits Value, Small Cap and International equities, albeit with weaker overall S&P 500 index returns than the Growth-led 14.1% annualized real total return (after inflation, with dividends reinvested) experienced in the decade 2011-21, a high level of returns that we believe is gone for a generation.”

Analysts who correctly predicted 2023 rally give their S&P 500 forecast for next year
 

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Comments (5)
gary leibowitz
gary leibowitz Dec 04, 2023 9:56AM ET
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5 weeks into a Pandemic all economists and stock analysts concluded the street has alteady anticipated and absorbed the bad news. One death on our soil and we crash? We live in a fantasy world whete every dire event is an opportunity to take advantage of.
Cosmo Politan
Cosmo Politan Dec 04, 2023 9:56AM ET
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5 weeks?
Daniel James
Daniel James Dec 04, 2023 9:25AM ET
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Not only has the fed been explicitly clear about lower rates but I don't think many people understanding why the fed lowers rates to begin with. The fed won't lower rates just to stimulate demand, they lower rates when they need to stimulate demand and right now, demand is so high that inflation persists. If they decide to lower rates for no reason, we'll see a return of inflation happen which goes against their goal of 2%.
Danny Barcenas
Danny Barcenas Dec 04, 2023 9:25AM ET
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Man you done contradicted yourself in the other comment you had to share.
Daniel James
Daniel James Dec 04, 2023 9:23AM ET
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I don't know why people think the fed will low rates just to lower them. Whenever the fed lowers rates, it's to stimulate demand which right now, is hot and causing inflation. If we were to lower rates for no reason, our ability to stimulate the economy in the event disaster hits is diminished.
Casador Del Oso
Casador Del Oso Dec 04, 2023 9:23AM ET
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People want the FED to lower rates so they can buy houses and have their stock portfolios go up in value.
Cosmo Politan
Cosmo Politan Dec 04, 2023 9:23AM ET
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To artificially increase their wealth... yeah.
Casador Del Oso
Casador Del Oso Dec 04, 2023 9:20AM ET
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Since the mid 1990s I have watch analysts making forecasts. Most are never right.
Eureka Archimides
Eureka Archimides Dec 04, 2023 8:47AM ET
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There are more funds than stocks. That is the number of analysts also. Can we see the percentage of analysts who are correct ?
 
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