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The S&P 500 defies the odds and mounting risks to continue its trend. The market broke above critical support in late September and is on track to reach bull case targets near 6,000 by the year's end. The move was sparked by the Fed, which leans toward lower interest rates but is driven by the robust outlook for earnings. With the two forces seemingly in tandem, the 6,000 level may only be a stopping point on the way to even higher highs.
The S&P 500's 6,000 target is derived technically and is likely low. Given the earnings and dividend growth outlook and assuming no change in the price multiple, the 15% growth expected for 2025 suggests a move to 6,600 is possible by the end of next year.
The S&P 500 Uptrend Is Supported by Earnings Growth
The outlook for S&P 500 earnings growth is driving the market today. Although the forecasts for FQ3 2024, FQ4, and the first half of next year have moderated since the summer, they remain strong at 4.1%, 14.2%, and 13.5%, respectively. The critical detail is that the FQ3 growth target, down sequentially ...
