Wall Street is betting on a strong US economy in 2025: Morning Brief
Published On Dec 4, 2024, 6:00 AM
Wall Street strategists are optimistic about the U.S. economy continuing to surprise with stronger-than-expected growth into 2025. Key firms like RBC and Wells Fargo are projecting significant growth, with estimates for the S&P 500 reaching 6,600 to 7,007 points by year-end. This optimism is driven by an anticipated GDP growth of 2% to 3%, with a shift towards 'value' stocks anticipated to perform better in this economic environment. Several sectors, including financials, consumer discretionary, materials, real estate, and utilities, are viewed as favorable for investment based on their connection to GDP growth.
Stock Forecasts
XLF
Positive
Given the strong optimistic outlook for the U.S. economy and the projected rise in the S&P 500, sectors such as Financials (XLF), Consumer Discretionary (XLY), and others mentioned are expected to benefit substantially. Large-cap value stocks are highlighted as particularly attractive investments.
XLY
Positive
The projected increase in GDP and associated market predictions suggest a strong performance for various sectors, indicating solid growth potential for ETFs that focus on U.S. market exposure.
XLB
Positive
Wall Street's bullish sentiment indicates that stocks will likely capture this economic growth leading into 2025, making sectors with exposure to economic recovery particularly promising.
XLU
Positive
With the expectation of robust GDP growth, utility stocks, typically seen as defensive, may also experience upward adjustments as investors seek stability in overall economic growth.
XLRE
Positive
Real estate sectors also stand to gain as interest in GDP-sensitive investments grows; REITs in particular are positioned for growth given the anticipated economic environment.
Related News
Job openings rise more than expected in October
Dec 3, 2024, 10:59 AM
Job openings rebounded in October as investors continued to debate how rapidly the US labor market is cooling to end 2024.
Stock market today: S&P 500, Nasdaq close at record highs as tech surges to kick off December
Dec 2, 2024, 4:00 PM
Investors are looking ahead to a week of labor data that could influence the scope of interest rate cuts.
S&P 500 will hit 6,666 in 2025 with large cap value stocks leading the way: BofA
Dec 2, 2024, 12:19 PM
Bank of America believes strong economic growth will support further broadening of the stock market rally in 2025.