Investors digest the Federal Reserve’s more-hawkish-than-expected outlook for its 2025 rate cuts and what it means for markets in the new year. Evercore ISI senior managing director of equity, derivatives, and quantitative strategy Julian Emanuel joins Julie Hyman and Josh Lipton on Market Domination Overtime to discuss his 2025 market outlook.
Emanuel justifies his S&P 500 target for year-end 2025 of 6,800, saying it "acknowledges the idea that in an expensive market, bad news is likely to have an outsized reaction, as we’ve seen in the last couple of days, but on balance, you’re going to have very strong earnings growth." He adds that, alongside earning growth, artificial intelligence should drive productivity gains in the new year.
The strategist notes that while he has a broadly positive outlook for equities in 2025, he expects the market to be more volatile. Emanuel says volatility spikes can serve as buying opportunities, as they don’t threaten the overarching picture of economic strength and earnings growth.
"We think you’re going to have [buying] opportunities [amid volatility], probably, on multiple occasions [in 2025], and in fact, we do think you’re going to get one sometime between now and the inauguration," he adds.
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