Deutsche Bank lifts S&P 500 year-end target amid Wall Street upgrade wave
(Reuters) - Deutsche Bank has raised its year-end target for the S&P 500 to 6,550 from 6,150, citing lower tariff-related earnings drag and a resilient economy, in a move that comes amid a broader wave of target upgrades by major Wall Street brokerages.
This follows similar moves by Goldman Sachs and UBS Global Wealth Management, which raised their forecasts in May, with RBC Capital Markets joining the trend on Monday.
"We now see the tariff drag at only about one-third of what we previously penciled in," Deutsche Bank strategists led by Binky Chadha wrote in a note on Monday.
The new target is 10.35% above the S&P 500 index's last close of 5,935.94.
The S&P 500 posted its strongest monthly gain since November 2023 in May, boosted by U.S. President Donald Trump's softer stance on tariffs, strong corporate earnings, and tame inflation data that helped markets recover from April's decline.
Still, the European brokerage warned that the rally could be volatile, with potential pullbacks driven by renewed trade tensions.
"We expect the rally to be punctuated by sharp pullbacks on repeated cycles of escalation and de-escalation on trade policy", the brokerage said.
Deutsche also increased the estimate for the index's earnings per share to $267 from $240.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
17 minutes ago
- Yahoo
Gold Holds Gain as Soft US Data Bolster Bets on Fed Rate Cuts
(Bloomberg) -- Gold held gains, after weaker-than-expected US data reinforced expectations that the Federal Reserve will cut interest rates at least twice this year to prevent a recession. ICE Moves to DNA-Test Families Targeted for Deportation with New Contract The Global Struggle to Build Safer Cars At London's New Design Museum, Visitors Get Hands-On Access NYC Residents Want Safer Streets, Cheaper Housing, Survey Says The Buffalo Architect Fighting for Women in Design Bullion traded near $3,375 an ounce, following a 0.6% increase on Wednesday, after separate reports showed a contraction in US service providers and a deceleration in hiring. Treasury yields fell after the prints, with swap traders pricing in two Fed reductions in October and December. Lower rates are typically a tailwind for gold, which doesn't bear interest. Elsewhere, fears about worsening friction between the US and some of its major trading partners resurfaced after President Donald Trump doubled steel and aluminum tariffs to 50%. Separately, he labeled Chinese counterpart Xi Jinping as 'extremely hard to make a deal with'. Bullion is up almost 30% this year and hit a record high in April, as an expanding US-led tariff war bolstered its appeal as a haven. Central banks have also been a major driving force, with their buying spree expected to continue amid geopolitical tensions and concerns about overexposure to the dollar. Spot gold edged up 0.1% to $3,375.21 an ounce as of 7:41 a.m. in Singapore. The Bloomberg Dollar Spot Index was down 0.1%, following a 0.4% loss on Wednesday. Silver was flat, while platinum and palladium rose. Looking ahead, a US jobs report due Friday is expected to show that growth in nonfarm payrolls slowed and the unemployment rate remained steady. Cavs Owner Dan Gilbert Wants to Donate His Billions—and Walk Again YouTube Is Swallowing TV Whole, and It's Coming for the Sitcom Millions of Americans Are Obsessed With This Japanese Barbecue Sauce Is Elon Musk's Political Capital Spent? Trump Considers Deporting Migrants to Rwanda After the UK Decides Not To ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
25 minutes ago
- Yahoo
SDRS investments tick up amid volatile markets
PIERRE, S.D. (KELO) — The South Dakota Retirement System's investments have rebounded a bit. The estimated return, covering the 11 months through May 31, was 3.2 to 3.7%, senior portfolio manager Darci Haug told SDRS trustees on Wednesday. Man identified in fatal Monday I-90 crash The annual target, however, is 6.5%. Whether that can be reached by June 30 isn't known. 'We aren't keeping up with the markets because of our conservative positioning,' portfolio manager Danielle Mourer explained. The South Dakota Investment Council oversees the SDRS portfolio. The council over the long term has taken a contrarian approach, holding larger amounts of cash at times when the market is, in the council's estimation, overpriced. That's how the council currently sees the markets. Nonetheless, being back in the black was an improvement over the April 9 report to the SDRS trustees. On that date, SDRS investments as a whole were down between 3 and 3.5%. The very next day, they had regained some of that lost value and were down 0.5 to 1%. Jarrod Edelen, another of the portfolio's managers, said earnings by different sectors have been volatile of late and varied widely. Technology investments such as computer chips were recently up 27% while energy investments overall were down 7%, he said. The fair market value of SDRS investments was $15 billion as of May 31, Haug said. How the SDRS investments fare year to year largely determines the size of the annual cost of living adjustment paid the following year to the system's retirees and other beneficiaries. SDRS senior actuary Doug Fiddler told the board that the COLA taking effect on July 1, 2025, will be 1.71%. That was calculated using the third quarter 2024 inflation rate of 2.49%. Fiddler estimated that a 3.5% annual return for fiscal 2025 would result in a COLA of approximately 1.4% taking effect on July 1, 2026. He said benefit payments to approximately 80% of SDRS retirees have been falling short of keeping up inflation by about 10%. Fiddler presented a chart showing the S&P 500 has been in a volatile stretch lately, dropping about 20% in April and gradually rebounding since then. Fiddler said that he had planned to brief the trustees on corrective actions that might be necessary when the SDRS investments were in the red for the year. But he changed his mind after seeing the number get back into the black. SDRS executive director Travis Almond spoke about market volatility to the board after Fiddler's presentation. 'So who knows how the end of this fiscal year lands,' Almond said. He suggested that the trustees keep themselves familiar with the corrections plan. 'I have no doubt we're going to have that conversation. It's a question of when,' Almond said. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
36 minutes ago
- Yahoo
Ukraine and U.S. discuss how to make minerals fund operational by year-end
WASHINGTON (Reuters) -Ukraine and the United States have discussed how to make a minerals fund operational by the end of the year and the fund's first meeting is expected in July, Ukraine's First Deputy Prime Minister, Yulia Svyrydenko, said in Washington on Wednesday. The agreement on developing Ukraine's mineral resources, heavily promoted by U.S. President Donald Trump, was signed by Svyrydenko in Washington in April after weeks of tough negotiations made the terms more favorable to Kyiv. Ukraine's parliament then ratified the deal. On Wednesday, Svyrydenko held meetings with U.S. Treasury Secretary Scott Bessent and the Development Finance Corporation, which would be a partner of the minerals fund, "and we discussed very concrete steps how to make this fund operational during this year," she told reporters. "So we plan to have the first board meeting of this fund in July and we will discuss what will be the seed capital to start operating this fund. And actually, too, we should adopt the investment strategy for this fund for the next few years." The negotiations leading to the clinching of the minerals fund deal followed a heated exchange at the White House between Trump and Ukrainian President Volodymyr Zelenskiy over how to work towards ending Ukraine's three-year-old war with Russia. The agreement was critical to Zelenskiy mending ties with Trump. The two men met briefly at the Vatican in April during the funeral of Pope Francis to help put their relations back on track. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
