JPMorgan Cuts S&P 500 Year-End Target by 20% to 5,200 Points
1min read JPMorgan Chase & Co. has lowered its year-end target for the S&P 500 index from 6,500 points to 5,200 points. This revision comes as the firm's chief equity strategist, Dubravko Lakos-Bujas, provides a new outlook for the benchmark index of the U.S. stock market. The firm anticipates that the index will be closer to 5,882 points by the end of 2024, reflecting a near 12% decline from the previous year's closing level.
In addition to the revised target, jpmorgan has outlined two scenarios for the S&P 500 index. The bearish scenario assumes that without any tariff relief, the index could further decline to 4,000 points, representing a 22% drop from the closing price of 5,074.08 points on the previous Friday. Conversely, the bullish scenario projects the index to rise to 5,800 points by the end of December, marking a 14% increase from the current levels.
JPMorgan has also adjusted its earnings per share (EPS) forecast for the S&P 500 index for 2025, lowering it from $270 to $250. This adjustment is based on the potential impact of tariff threats on demand, capital expenditure, and pricing power. The firm warns that companies may need to reassess their growth expectations during the first-quarter earnings reporting season.
The firm's strategic adjustment reflects a cautious approach to the market's future performance, considering potential economic and geopolitical factors that could influence the index's trajectory. The bearish scenario highlights the potential impact of ongoing trade tensions and the lack of tariff relief, which could lead to a significant decline in the index. On the other hand, the bullish scenario suggests that favorable economic conditions and market sentiment could drive the index to new heights.
JPMorgan's revised target and scenarios provide valuable insights into the firm's expectations for the U.S. stock market. Investors and market participants can use this information to make informed decisions and adjust their portfolios accordingly. The firm's strategic outlook underscores the importance of staying vigilant and adaptable in the face of changing market conditions.
