Wall Street Analysts Lower 2025 S&P 500 Targets Amid Trade Uncertainty

Over the past few months, the outlook for the U.S. stock market has become increasingly uncertain, prompting analysts on Wall Street to reassess their target price points for 2025. This shift is largely due to the volatile market conditions, which have been significantly influenced by the unpredictable trade policies of the Trump administration.

Stock investors have experienced significant fluctuations in recent times, with a large part of the reason being the uncertainty surrounding the trade policies of the Trump administration. Following the S&P 500 index reaching a historic closing high of 6,144 points on February 19, the index saw a sharp decline of 10% in less than a month, falling to 5,521 points on March 13, before showing some signs of recovery.

As of Monday's close, the S&P 500 index rose by 1.76% to 5,767.57 points, primarily due to market optimism over the possibility of the White House adopting a more flexible tariff policy. Earlier, U.S. President Trump had indicated that new tariff measures would be implemented on April 2.

Analysts on Wall Street are struggling to predict the future direction of the U.S. stock market, as recent volatility has caught them off guard. Initially, analysts had optimistic expectations for 2025, anticipating a significant rise in the U.S. stock market following the substantial gains in 2024.

Scott Chronert, an analyst from Citigroup, noted in a recent report that the previous target for the S&P 500 index in 2025 was set at 6,500 points, based on an earnings per share of $270. Despite the current economic fundamentals remaining intact, the ongoing policy and macroeconomic uncertainties have led to a reevaluation of these targets. The frequent changes in trade policies have made economic forecasting challenging, adding to the market's volatility and investor anxiety.

Chronert had previously set a target of 6,500 points for the S&P 500 index in December 2023, with an optimistic scenario of 6,900 points and a pessimistic scenario of 5,100 points. While he has not formally lowered his 2025 forecast, his current stance leans towards the lower end of the previously predicted range.

Chronert is not the only analyst reassessing the market. Earlier this month, Yardeni Research, known for its bullish outlook, reduced its "best-case" target for the S&P 500 index from 7,000 points to 6,400 points, acknowledging that it had underestimated the impact of tariff issues. Meanwhile, Goldman Sachs analyst David Kostin recently lowered his target from 6,500 points to 6,200 points.

However, some analysts remain steadfast in their original views. At the end of last year, Bank of America Securities set a target of 6,666 points for the S&P 500 index, citing the progression from 666 points in 2009 to 6,666 points in 2025. So far, the bank has not adjusted its forecast. Michael J. Wilson, an analyst from Morgan Stanley, also reiterated last week that he expects the S&P 500 index to reach 6,500 points by the end of the year.

Barry Bannister, the chief equity strategist at Stifel, who is known for his bearish stance, has maintained his target of 5,500 points for the S&P 500 index this year, which is approximately 5% lower than the current level. Bannister also noted that the U.S. stock market may continue to rebound in the spring, followed by a gradual slowdown in the second half of the year. This is due to investors focusing on issues such as slowing growth and persistently high inflation.