As per the latest client note published on Sunday, shared via Forbes, Goldman Sachs sounds bullish over S&P 500 while citing expectations of US fiscal stimulus. The details suggest, another round of fiscal stimulus totaling roughly $750 billion, including $300 billion in stimulus checks, $250 billion in relief for state and local governments and $150 billion in extended unemployment benefits, per the report.
The investment bank signals 6.4% US GDP growth for 2021, versus -3.6% marked in 2020 and 5.9% estimated earlier.
Concerning the US unemployment rate, Goldman Sachs hints 4.8% level after staying mostly unchanged near 6.7%.
It was also mentioned in the report that S&P 500 will grow their earnings by a better-than-expected 31%, but a likely corporate tax hike under Democrats would go into effect in 2022, leading to lower-than-expected yearly earnings growth of 10%.
The bank’s analysts anticipated a near 1.8% increase in the average price of goods and services for 2021 while saying, “More fiscal spending, faster economic growth and reduced economic slack will in turn drive higher inflation and interest rates.”
In the end, the report summed up the bullish expectations while mentioning, “S&P will rise to about 4,300 points by the end of the year, giving the index 13% upside from current levels after climbing 16% in 2020.”
That said, Wall Street benchmarks are on their north-run to refresh record highs off-late, despite Monday’s downbeat performance.
Read: Wall Street Close: Stocks slip amid defensive markets, big Tech stumbles after blanket Trump bans
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