Why strategists are boosting their S&P 500 year-end targets

00:00 Speaker A

Now time for today’s strategy session. Analysts in Wall Street are rising to US stocks. After getting rid of tariff -based sales, more than one strategist in the S&P 500 that increases the year -end 2025 targets. Now, when we join us, one of the strategists who increased the target, Keith Lerner, Truist joint investment officer and chief market strategist and a good friend. Keith, it’s nice to see you here. Why take us into the thesis where you raise your goals now.

00:40 Keith Lerner

Yeah, it’s great to be with all of you. Maybe I’ll step back for a context. In February, we had the highest levels of all time. We have dropped the stocks and then we told our customers to be balanced again towards low levels, and told you that you should start thinking about the risk of head. In the first rebound, when we bought rebounds, we actually went out of the table a little bit of time a little time, but then our work claimed that the risk of stagnation was still relatively high. After that China walked back. So, as we now reset and say, okay, where are we in front of the evidence in our work right now. And when you look at something, when you look at six months later, this is actually a positive sign. Instead of stagnation, you know, say 50%, I think our main situation is more confusion. And something that has changed since February, when we first downloaded the stocks, was the earnings of earnings for S&P. He began to move down in February. It’s part of the reason we’ve dropped stocks. Now they are bent higher. Most of them are directed by technology and communication and this is the last point. We had all this tariff uncertainty, right? Big T tariffs. I think what the market has found in the last few months is the other T technology and AI, the dominant theme of this bull market.

03:27 Speaker B

Yes, Keith is really excited to take your thoughts about the technology sector, especially as you mentioned, as a part of it. To what extent do we continue to learn the course of investors, which you can withstand these big technology stocks, regardless of these large technology stocks, wider market activities?

04:01 Keith Lerner

Certainly. The first thing I will say is that we are overweight communication services with an AI game all year. We have added to Tech, and I think what is important for technology is that many times we look at how much we have been moving from the lowest levels for market and technology, but if you look at the S&P technology industry since last July, we’re fixed. And you’ve talked about Nvidia before, which has been rising modestly since last July. So, if you look at the big picture for the general market S&P, we have been flat for almost a year for the technology sector for almost seven months. So when testing such technical levels, and you think we’ll finally break it on it, probably there’s some pain trade. So I want to be open, so we start with higher values ​​for the general market, so I think it might be a higher squeezing, but I don’t know we’re going to the races. I hope there will be some impacts along the way, especially in the summer months when we see some liquidity along the way, but in general, the basic trend is still positive and we want to adhere to this basic tendency.

05:46 Speaker A

Okay, you’re starting to answer my question around the valuation, so I’m going to talk more about this liquid. Does this mean low volume in summer? Does it mean more volatility in this interim period?

06:03 Keith Lerner

Yes, I think what might happen, I hope some adult drums, right? After seeing the first half, it would probably be good like some boring trade. But I think what you can be, some unexpected titles, if you get many people on holiday, there is less liquidity, I think you can see that the movements are intensified. And there’s an old word, sell in May and go, but it’s actually wrong. What really happens, Sunday tends to be successful until July, and then you start to see more seasonal weakness as you enter August and September. I think this will happen in your quest. UM and again, we expect more confusion for the economy, so not for our opinion, hey, I think it’s time to be in the whole crime, and even the people watching the show today, I think we will be more compatible with the allocations of long -term conversation equality, I think we will be more compatible with the tendency again, overly or under the tendency, but the underlying tendency.

07:45 Speaker B

Right, don’t fight the tape, it sounds nice, as you said, Keith. However, I wonder that investors are a little after the tariff and focus on the movements of the Federal Reserve instead, especially when we consider that we see such a strong market reaction from the expected inflation pressure to this morning. Does today’s market action show that Trump is directed to the FED from Trump?

08:27 Keith Lerner

You know, I can say almost anything. I mean, both of them are important, but for a while I thought about it, the tariffs were the only thing that matters. And I think we learn today, many other factors are important. So the tariffs are still important, not equally. The Fed is still important, but not equally. And I think it’s about the Fed right now, the reason I say it’s important, but you know, even if you look at the fund funds term transactions, the market is priced, the first ratio deduction is September. So think about where we are today, we are still in June. Between now and between September, there is a lot of time when the Fed really returned to the game in a really meaningful way. I think this shows that the CPI has fallen in the right direction. I think there are still some questions, will we see some changes in inflation data as some of the tariff effects come? I think this is a clear question. So temporarily, I think, you know, I think economic data are very important, so there was a lot of concern about stagnation before. Will we see some air pockets on the couple for the next few months? Will it still show some flexibility? In other words, weekly unemployed claims will be important, employment official will be important, inflation trends and Fed seems to be like. Again, I think all this is important, but I don’t think it’s just specific, as if the market is now focused. And again, if we return to a wider picture, conversation, technology is important and what is on the technical side.