We believe that the S&P 500 can reach new maximums in the second half of 2025 and keep our end -of -year target at 6,400 points. Laura Cooper, Head of Macro Credit and Investment Strategist by Nuveen underlines this, explaining that “our View is supported by the performance of the Treasury at 10 years, which we foresee will remain within a defined interval, making the actions relative to the risk without the risk of the government bonds; from the gradual locking of the monetary policy by the Fed and the solid growth of the profits, which should contribute to containing to contain. The already high price/profit ratio of the S&P 500 ″ index.
Wall Street returns to investors
In our opinion, the collapse of the US equity market recorded in the aftermath of the Liberation Day “represented the peak of the crisis due to the duties. Since then, the risks of recession have decreased: if then the markets made a probability of about 70% of a recession in the United States in the next 12 months, now this probability has fallen to about a third. Thanks to the greater clarity on the commercial front, to the signals of containment of the inflation and Resilience of economic growth, investors are again looking with interest in the US equity markets.
Focus on Technology and IA
On a sectoral level, “we see investment opportunities selected in the information Technology sector thanks to favorable factors that derive from cloud computing and the demand for semiconductors. Artificial intelligence is undoubtedly our favorite subsector, since we foresee strong multi -year growth from this moment on, with consequent revisions to the rise in profits.
We also believe it appropriate to prepare for further volatility during the year, in light of the various obstacles that weigh on the equity markets, including the possibility of a slowdown in economic growth and an increase in inflation. In this perspective, we privilege US securities dividend growths and global securities in the infrastructure sector, market areas that can contribute to mitigating the risk of reduction and that could prove more resilient if the duties should cause a shock to the rise in prices “,
Nuveen’s View
The magnificent 7 remain fundamental components of the allocations of wallets with exposure to the USA, driven by the growth of profits: these securities have represented 68% of the incremental growth of profits in the last decade. Artificial intelligence is our favorite sub-sector in the Tech field: companies that can satisfy the apparently insatiable question of IA are the best positioned.
Finally, given our strong overweight on the US technological sector, “we consider particularly interesting Microsoft and Nvidia. Microsoft because of its fundamental solids supported by the cloud and by the artificial intelligence tools, solid financial data and prospects on the profits favorable from the demand for AI services. The improvement of the offer conditions, the strong demand for chips and its position in the expense boom for artificial intelligence boom instead they support the interest in Nvidia “,
