Goldman Sachs has raised its end-of-year target for the S&P 500 from 3,600 to 3,700.
The S&P 500 opened above 3,600 on Monday after news broke of the 90% effective vaccine from drugmaker Pfizer Inc. (NYSE: PFE), but closed near 3,550. Monday’s session was exceptionally volatile
The two trading days since Monday have been significantly calmer and the bullish trends are emerging.
Goldman’s main driver for this forecast was Pfizer’s vaccine. It believes the vaccine could get emergency use authorization from the FDA as soon as January 2021.
The COVID-19 pandemic has been wreaking havoc on international financial markets since March of this year. “However within less than a year, a vaccine’s been discovered.” Goldman’s chief U.S. equity strategist David Kostin wrote in a note.
And while the 2020 presidential election has been the focal point of the news in recent months. Kostin wrote, “the divisive U.S. presidential campaign was actually a backdrop to the main event: a public health crisis.”
At writing, the S&P 500 was trading near 3,565. If the end-of-year target of 3,700 is met, that would be a 3.8% increase from current levels.
Goldman also forecasted the 2021 year-end level to be 4,300. This would be a 16% increase from the projected 2020 year-end forecast.
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