Home Market News <!DOCTYPE html> <html> <head> <title>Ed Yardeni’s 12 reasons why the S&P 500 will reach 5,400 in 2024</title> </head> <body> Financial Expert Predicts S&P 500 Will Soar to 5,400 by 2024

Ed Yardeni’s 12 reasons why the S&P 500 will reach 5,400 in 2024 Financial Expert Predicts S&P 500 Will Soar to 5,400 by 2024

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    Financial Expert Predicts S&P 500 Will Soar to 5,400 by 2024
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Nikada

Financial expert Ed Yardeni, president of global strategy and asset allocation analysis company Yardeni Research, forecasts the S&P 500 (SP500) to reach 5,400 by next year’s end, with an EPS of $250, the highest target among consensuses.

If his projection holds true, the S&P 500 would rise above 5,800 at the end of 2025. Yardeni recently revised the 2025 price target to 6,000, stating, “In other words, we believe that the bull market has remarkable staying power.”

As of Tuesday, the S&P 500 (SP500) closed at 4,775.

Here are Yardeni’s 12 reasons for foreseeing a “roaring 20s” scenario:

  1. The economy may remain resilient, potentially leading to lower inflation and prompting the Fed to reduce rates, influenced by robust labor demand and high household net worth.
  2. Factors such as decreasing excess savings and potential increases in personal debt are expected to have minimal impact on consumer purchasing power as long as job security remains high.
  3. The third quarter marked a record-high household net worth of $151 trillion, with liquid assets poised to benefit further following the Fed’s reduction of short-term interest rates.
  4. Robust labor demand, particularly seen in better-than-expected retail sales, signifies the strength of the leisure, hospitality, and health care industries.
  5. Manufacturing companies onshoring to the U.S. due to pandemic-related supply chain disruptions, alongside geopolitical tensions between the U.S. and China, are driving increases in the construction industry and machinery orders.
  6. Lower U.S. mortgage interest rates are anticipated to propel new and existing home sales, consequently boosting sales of home-related retail items.
  7. U.S. corporations have managed to generate a record $3.4 trillion cash flow during the third quarter, despite pressures on profit margins from high labor costs and interest rates.
  8. Supply chain disruptions resulted in inflation on durable and nondurable goods, though the services inflation shock is showing signs of dissipating.
  9. Increased technology spending by companies, driving high-tech equipment and software production to all-time highs, indicating a major cycle in productivity growth from 2015 onwards.
  10. Yardeni dismisses impending recession indicators, citing strength in the services, nonresidential private and public construction, and high-tech capital spending sectors as offsetting any recession in the goods sector.
  11. Rising industrial production in the defense sector is expected to hit new record highs due to geopolitical turmoil, whereas global deflationary pressures stemming from China’s economic woes and a forecasted European recovery will contain regional conflicts.
  12. The positive economic outlook is likely to bolster the equity market, supported by the Fed’s Summary of Economic Projections signaling a potential subsiding of inflation without a recession.