(Reuters) -HSBC on Tuesday raised its year-end S&P 500 index goal by greater than 800 factors to six,400, citing euphoria round synthetic intelligence and easing U.S. coverage uncertainty.
The improve comes after related strikes from different brokerages, together with Goldman Sachs and BofA World Analysis, final month.
“The AI commerce is powering the tech/AI cohort greater (roughly half of the S&P 500), whereas diminished coverage uncertainty (specifically tariffs) is fueling the ‘relaxation’ of the market,” HSBC strategists wrote in a notice.
The S&P 500 has rebounded 30.8% since its April 8 low, following U.S. President Donald Trump’s ‘Liberation Day’ tariffs. The index notched recent highs in July, pushed by upbeat earnings from tech giants Microsoft and Meta Platforms, which renewed investor optimism round AI.
HSBC’s new goal represents a marginal 1.1% upside to the index’s final shut at 6,329.94. Its earlier goal was 5,600 for the index.
The brokerage expects slower progress within the U.S. within the second half of the 12 months, permitting the Federal Reserve to scale back rates of interest, and sees the tariff affect to stay muted and short-term.
However in its bull-case situation, HSBC expects the index to finish the 12 months at 7,000.
“We imagine there’s nonetheless room for margins to increase in tech…do not see valuations as stretched for the tech sector,” HSBC strategists mentioned in a notice to shoppers.
(Reporting by Kanchana Chakravarty in Bengaluru; Enhancing by Anil D’Silva and Shinjini Ganguli)
