UBS analysts have upgraded their year-end S&P 500 index target by another 4.8% following a previous upgrade on January 16 from 4,850 to 5,150.
The bank now predicts the index, which tracks the 500 largest US companies representing approximately 80% of total market capitalization, to close the year at 5,400.
UBS’s upgrade makes the European bank the most bullish among its global peers.
On Wall Street, Goldman Sachs recently upgraded its 2024 S&P target from 5,100 to 5,200. “Increased profit estimates are the driver of the revision,” said a team led by David Kostin.
An artificial intelligence-powered rally on Big Tech stocks, which account for nearly half of the S&P’s market cap, pushed the index to all-time highs above 5,000 this year.
This has led to $18 billion in new S&P long positions while pushing up to $30 billion in shorts out of the money, according to Citi data.
A booming US economy and robust jobs market have further contributed to a sunny outlook on the lead index, despite the prospect of higher-for-longer interest rates adding to earnings pressure.
Fabless semiconductor megacap Nvidia Corp is gunning for another record quarter of revenues in Wednesday’s earnings call, which could provide even more bullishness for the wider stock market.
At the time of writing, the S&P was trending at 4,976.99.