After falling from last month’s historic highs, market sentiment in the US stock market has reached a low point. Julian Emanuel, a quantitative strategist at investment bank Evercore ISI, predicts that the market will continue to decline until 2024.
The S&P 500 is expected to drop another 6% this year, with factors such as the US presidential election and the Federal Reserve being seen as negative influences on the market. Julian Emanuel further predicts that the target price for the S&P 500 by the end of 2024 will be 4,750 points, indicating a 6% decline this year.
Julian Emanuel believes that the stagnation of efforts to combat inflation, uncertainty about the timing of interest rate cuts by the Federal Reserve, and the US presidential election in the second half of the year all add significant pressure to the stock market.
Furthermore, Julian Emanuel adds that the current monetary policy is “more like a question mark” and will serve as a catalyst for further decline in the stock market. He also expects that a “very topical election” will shift consumers’ attention from “spending” to “who to vote for.”
Despite the bearish market sentiment, Julian Emanuel still plans to buy at the lows when the S&P 500 tests its target price, considering it a good buying opportunity. He believes that part of the reason for the overextension of stocks in March was market participants’ optimism about record fund inflows. Therefore, in the current environment, investors will moderate their optimism and make corresponding adjustments.