Uddrag fra Authers, med dansk resume i indledning
Resumé:
The Long and Short of It |
Even the bulls were wrong about 2024. The S&P 500 closed the week at yet another record, and it’s now up 23% for the year. Wall Street has institutional reasons to be bullish, but even sell-side strategists have been surprised. This is how it’s moved, along with the average prediction for year-end, as compiled by Bloomberg colleague Lu Wang. In January, strategists expected the world’s most tracked index to be flat for the year. They’ve raised their estimates again and again, and the S&P 500 has outpaced them:
Some of this is explicable in terms of the economy. The jobs market has held up much better than expected, while inflation appears to be beaten. Rates are high, but declining. All the gains from artifical intelligence, we now know, weren’t yet in the price in January. But the political uncertainties are well known, and reliable long-term metrics suggest extreme caution. So what’s going on? And how exactly do you deal with a situation that looks set fair in the short term (give or take the outside risk of World War III) but unfavorable in the longer term?
Wall Street is trying. One of its most prominent figures, Goldman Sachs Group Inc.’s chief US equity strategist David Kostin, has published a remarkable double. On Oct. 4, he raised his year-end S&P forecast from 5,600 to 6,000, with a 12-month target of 6,300. That’s about 11% over a year. Last week, he published a follow-up paper suggesting that the index will gain only 3% in nominal terms (1% in real terms) per year over the next decade — which would be one of the worst on record. This is despite a headstart of 10% in the next 12 months.
Contrary to initial impression, this isn’t totally contradictory. Indeed, it makes sense. But to predict simultaneously that an already strong market will have a great next 12 months and a poor next 10 years does imply an untenable spot, or even, conceivably, a bubble. Let’s go through the main drivers in order
