The Senate is a virtual lock for the Republicans after Ohio went Republican. Trump currently has a 90% chance to win the Presidency according to election betting odds (at the time of writing this).
We had established a 6,600 target for the S&P 500 Index for YE 2025 based on a very high probability of the Senate going Republican, which would stop a large increase in the corporate tax rate.
We are now raising our 2025 S&P 500 Index year-end target to 7,000 based on a likely Trump win. Our target assumes an effective reduction in the corporate tax rate to 18% and an expansion of the multiple on the S&P to 22x based on a more favorable business environment. We expect our 2024 target of 6,000 on the S&P to be exceeded substantially by year end. The combination of a Fed easing cycle, AI driven technology boom and a pro-business administration is extremely bullish for the stock market and we believe the risk to our 7,000 2025 YE target is to the upside.
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