S & P 500 is still significantly high

Welcome back. Each twist and turn from the White House brings a new rally or sale in S & P 500. Missing the bigger picture of the market?

In spite of the sign a US EconomyDonald Trump’s tariff plans and uncertainty, Wall Street analysts still expect the main stock index below under the main average below 6,000. This means that in the S & P 500 will increase at least 5 percent between this and December 31.

So this week, why the market is wrong and why the S & P 500 will end this year why considerable below the current 5.525 level.

The final annual exchange stock exchange will eventually associate with the annual investors’ annual economic outlook and their artificial intelligence and structural drivers as the US exclusive.

For 2025, analysts expect that the S & P 500 levels will not change widespread last year. This is a remarkable brand that has been a consecutive annual growth over two years older than two years. But is it still very optimistic?

Let’s start with economic grounds. I defended this last month America was going to the recession. (This is based on the economic weakness of Trump’s second period, the impossibility of the provision of politics and some import duties.

Analysts are more focused on real tariff ads. Indeed, the “Azadlig Day”, consensus growth forecasts for 2025, and the likelihood of uninstallers in the next 12 months increased by 45 percent. Most US effective tariffs (substitution effects) will approach about 10-20 percent this year. Currently appreciated around 28 percentHe started about 2025 to 2.5 percent.

These predictions look reasonable: if there is no recession, more high tariffs and slow growth than last year. But the market is still more optimistic.

“The information obtained from risk assets will even think markets will take a moderate form this year,” he said, using a simple regression model, a highly macro strategist using the active pricing of growth this year

This year is very high expectations for corporate gain. Wall Street’s risk-on or risk-off news items is easier to get and sell decisions based on the news items. It may take longer to judge the impacts of companies to the bottom lines.

“Usually earnings, even in temperate recessions,” he said. “Only 10 percent of the market in the market is currently 10 percent of the market. This is not small to peak profit margins last year.”

Analysts can be very optimistic for companies to pass consumers from any tariff costs. The most imported sectors – industry, material and consumer generating sectors, as well as price energy, notes of BCA Studies in the US capital strategy group.

Companies that assume that the prices will not be able to significantly lift the S & P 500 net income limits indicate Trump tariffs to reduce the limits of 2.2 percentage points. In the hood, 19.2 percent translates the decline in 19.2 percent, everything is equal (for 10 percent of tariffs for all countries, 54 percent return to piles of steel, aluminum and car.)

For measurement, Goldman Sachs estimates that the S & P 500 EPS, which causes an increase in each 5 percent point in the US Tariff.

What tariff worldview is associated with consensus forecasts for EPS to grow in 2025 current Economic environment: high uncertainty, poor consumer and investor confidence and high import duties. (Planned ships The port of Los Angeles is expected to have a significant year in two weeks in two weeks per year.)

Earnings are now coming quickly. The level of reduction in the number of income by analysts for 2025 is the level of regulation, although the real enlargements of discounts are relatively small. As earnings fall, analysts will evaluate assessments as calibration.

For measurements, the printer earnings rate (how much future earnings are ready to pay for each dollar) are now close to 19. About 17 before the pandemic.

Goldman Sachs’S S & P 500 Using the sensitivity matrix will increase by 3 percent this year, and the P / E ratios will only return to PANDEMED averages and to return to PANDEMED averages and up to 4550.

Of course, the S & P 500, if the structural factors provide shopping, such a heavy fall is possible.

But first the AI ​​narrative hit the road obstacles. Deepseek’s low-valued model release in China, placed billions of focus on the spending of the AI ​​capital technological companies. Trump trading ads – Added additional pressure, including Asian technological manufacturers and the tasks scheduled for chip export restrictions.

“We are still looking forward to the” killer application “where a heavy hood is occurring. Low barriers to the construction of large language models (magnificent seven) explain the fund manager in Premier Mitton investors. “They also appreciate how slowly affects the gains of tariffs.”

The stock prices of the magnificent technological enterprises were overcome due to the opening of Trump’s prices. However, analysts are not known to those who are valuable. Companies make up one-third of the S & P 500 market capitalization. (They are also an easy way to reduce the leap of news, which is the proper way to sell, the risks of selling risks in the entire exchange market.) Thus selling the risks.

Still, their forward p / E remains in pandemic levels (individual and collective) before the majority. Both tariffs and prices can further reduce the gains in terms of the AI ​​hype.

Second, the exception of the United States. For years, the United States has attracted capital with the reliable state of deep liquidity, stability and assets. This allowed the S & P 500 to grow outside the economic grounds.

But the narrative weakens. According to the request of the American Fund Manager inquiry in March the most record. Tariffs are disproportionately equal to America. His companies are the biggest beneficiaries of the “Asian Production” model, Notes Matt King, the founder of Satori’s concepts. (Response measures will also hurt us.)

Politics, radical uncertainty, increasing financial stability, and independent economic organizations (such as the US federal reserves) make us a less reliable place to park capital.

“The United States is from the cleanest dirty shirt ‘, the most ugly and still the most expensive product, the most expensive product that targets the investment wardrobe,” he said. “After this year’s amendment, the US capital maintains an important exclusive premium trade in the US capital, 50 percent high in US capital.”

This exposes America to a capital flight depending on the attractiveness of the movements of the Trump. Paradoxically, if the president continues when the term begins, the United States will be more trusted in the United States to further developed economic basis.

S & P has been reduced from 10 percent to the peak of February 500. However, there is difficulty in knowing what the flow of news is or not.

Policy ads, freedoms, suspended and rejected permanent sauru, the permanent price of investors is re-assessed every day they think about one day. This changes the door points to judge the growth and profitability forecasts.

For all noise, the market is still placed for a hopeful result. Shares are not even the price for even a slight decline. “To rise to where the consensus in the S & P 500, the Trump should immediately turn back the tariffs,” Berezin.

Of course, the latest peaks offer that the president can become a bit. But how much? And when? Most investors, as a result, if the tariff rates are reasonable at least In 2025, it hits a few higher than where they started, along with the stretching of economic uncertainty, but still the full price is not fully appreciated.

Wall Street’s earnings and growth forecasts will fall further. As they did, the markets can further investigate the exceptional narratives of AI and the United States. Therefore, I am afraid of the S & P 500, not with 5 levers, but to a 6 – but with 4.

Send your rebutals, reflections and SO & P 500 forecasts last year freelunch@ft.com or x @ TeamPperikh90.

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