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CNBC
12 hours ago
- Business
- CNBC
Wells Fargo hikes S&P 500 target as U.S. tariffs get delayed again
The U.S. pushing back many of the tariffs announced earlier this year will help Wall Street through the end of the year, according to Wells Fargo. The bank's Investment Institute raised its year-end S & P 500 target range to 6,300-6,500 — putting the midpoint at 6,400. Strategist Darrell Cronk previously expected the benchmark to end 2025 between 5,900 and 6,100. "We believe delayed tariff increases will mitigate this year's U.S. economic growth slowdown and extend the soft patch into early 2026. This should dilute positive impacts from frontloaded tax cuts and deregulation during the first part of next year. We think the protracted tariff implementation will mute and defer the brunt of tariff-related price pressures until later this year and into early 2026," Wells said in a note to clients Friday. President Donald Trump in April unveiled steep charges on imported goods arriving from other countries, but soon after pushed back the implementation of those duties. That helped the S & P 500 recover from a sharp sell-off that nearly tipped the benchmark into a bear market. The index last week hit a fresh record high of 6,481.34. .SPX YTD mountain SPX year to date "Extending tariff implementation over a longer period coupled with the passage of the tax provisions in the [One Big Beautiful Bill] has improved investor sentiment and our forecast for equity earnings and returns," Wells Fargo said. Not everyone is as sanguine on stocks right now. Evercore ISI's Julian Emanuel who, at 5,600, has the lowest S & P target in CNBC's Market Strategist Survey , thinks the benchmark could pull back by anywhere from 7% to 15% from current levels. He said Federal Reserve Chair Jerome Powell's speech this coming Friday at the Jackson Hole symposium could send the market lower if investors leave with less confidence toward central bank rate cuts. "Powell on 8/22 is likely to indirectly signal a 25bp rate cut on 9/17/25 – stressing 50bp is not an option absent Labor market deterioration, and Oct and/or Dec cuts will be 'data dependent.' For a market that was eager to embrace '50 in Sept,' a balanced view could catalyze a near term -7% to -15% pullback into October, within the context of the Structural AI Driven Bull Market," Emanuel said in his weekly note to clients. UBS' wealth management arm also sees potential for "near-term volatility" with the market at current price levels. "Equity valuations are now elevated after a substantial rally in recent months," head of U.S. equities David Lefkowitz wrote. "The economic impact of U.S. tariffs is currently feeding through, with the labor market weakening and inflation rising. Uncertainty remains—regarding the scale, distribution and second-order effects." Still, Lefkowitz expects stocks to be higher a year from now.
Yahoo
04-06-2025
- Business
- Yahoo
Stocks Get Another Upgrade on Wall Street as Tariff Fears Fade
Another Wall Street firm turned more bullish on the stock market on Wednesday, as analysts came around to the possibility the worst of this year's tariff shock is in the rearview mirror. "Peak tariff uncertainty is likely passed, which should allow modest valuation expansion from here," wrote Barclays analysts, who raised their year-end S&P 500 forecast to 6,050 from 5,900 on Wednesday. Several other firms have raised their targets for the index in recent weeks, citing easing global trade tensions, continued resilience of the U.S. economy, and the stimulative potential of the tax and spending bill working its way through Congress. Deutsche Bank on Tuesday raised its year-end forecast to 6,550, and UBS last week lifted its target to 6,000. The stock market's outlook may have improved in the last month, but it remains drearier than at the start of the year, when investors were optimistic about President-elect Donald Trump's pro-growth, business-friendly agenda. Only two Wall Street firms tracked by CNBC's Market Strategist Survey have not lowered their expectations for the S&P 500 this year. Barclays analysts left their forecast for S&P 500 full-year earnings per share unchanged at $262, down from $271 at the start of the year. Many of President Trump's tariffs have been delayed or diluted, but those that remain are expected to directly subtract nearly $10 from the index's EPS. Slower international growth and diminished consumer spending are expected to detract an additional $1 and $2.10, respectively. Better-than-expected first-quarter earnings and tariff-induced inflation are forecast to offset some of those headwinds. Barclays expects corporate earnings growth to normalize in 2026, when—assuming tariff rates remain unchanged—the direct drag from duties will get lost in year-over-year comparisons. Tariffs are still expected to weigh on consumer spending and slow global growth, but those headwinds should be more than offset by AI-driven growth. The firm expects the S&P 500 to end 2026 around 6,700, about 12% above Tuesday's close. Read the original article on Investopedia
CNBC
24-04-2025
- Business
- CNBC
One of the biggest bulls on Wall Street throws in the towel for 2025 on mounting economic concerns
Even Deutsche Bank's Binky Chadha, one of Wall Street's biggest bulls entering 2025, is going back on his optimistic view on equities. The bank's chief U.S. equity and global strategist cut his year-end S & P 500 target to 6,150 from 7,000. The new forecast signals an advance of just 4.6% from where the benchmark began 2025. The old target pointed to roughly 19% upside. Chadha had the second-highest target on CNBC's Market Strategist Survey entering 2025. The only one who had a higher forecast was Oppenheimer's John Stoltzfus, who has also cut his year-end target to 5,950 from 7,100. Deutsche's reduction comes as U.S. stocks are pressured by uncertainty on the global trade front. President Donald Trump unveiled earlier this month sweeping tariffs on imported goods. Some countries, including key trade partners China and Canada, retaliated with levies of their own. To be sure, the Trump administration this week signaled it may take a softer stance on tariffs, particularly as they pertain to China. Stocks took this as a positive, with the S & P 500 up 1.8% this week. The benchmark is still down 5% since the April 2 "liberation day" announcement. .SPX YTD mountain SPX year to date "While there have been several attempts at de-escalation there has not been a credible relent on trade policy, while macro concerns have been mounting," Chadha wrote, noting he sees the S & P 500 trading in a wide range between 4,600 and 5,600. The upper end of that range points to 4.8% upside from Wednesday's close. The lower end implies a drop of nearly 14%. "We see successful passage of the fiscal package as potentially prompting a rally, but with any direct benefits for corporates dwarfed by the hit from tariffs, we see the rally as short lived," he said. Chadha also slashed his 2025 S & P 500 earnings per share estimate to $240 from $282, implying a 5% decline from 2024. He added that significant decline in Trump's approval ratings are needed before the administration truly moves away from its protectionist trade stance. "Approval ratings have been falling but very slowly as growth has remained solid and inflation has not picked up yet. A move to the low 40s is likely necessary, while a full catch down would see them down to the mid-30s," Chadha wrote. Elsewhere Thursday morning on Wall Street, JPMorgan upgraded Cadence Design Systems to overweight from equal weight. "The forward CY valuation is appealing and undemanding at 34x, at the low end of its trailing five-year range of 28x to 53x," analyst Harlan Sur said. "Investors will increasingly be drawn to the defensive growth characteristics of Cadence amid a slowing macroeconomic environment and the limited impact of trade/tariffs." Get Your Ticket to Pro LIVE Join us at the New York Stock Exchange! Uncertain markets? Gain an edge with CNBC Pro LIVE , an exclusive, inaugural event at the historic New York Stock Exchange. In today's dynamic financial landscape, access to expert insights is paramount. As a CNBC Pro subscriber, we invite you to join us for our first exclusive, in-person CNBC Pro LIVE event at the iconic NYSE on Thursday, June 12. Join interactive Pro clinics led by our Pros Carter Worth, Dan Niles, and Dan Ives, with a special edition of Pro Talks with Tom Lee. You'll also get the opportunity to network with CNBC experts, talent and other Pro subscribers during an exciting cocktail hour on the legendary trading floor. Tickets are limited!
