Morgan Stanley, Goldman at Odds on S&P 500's Bull Market Rally

Wilson ranked No. 1 in last year’s Institutional Investor survey after correctly predicting the selloff in stocks, but his outlook for further declines in 2023 has proved wrong so far.

Catch Up

Goldman Sachs is optimistic, saying the S&P 500 is set to keep climbing as sectors beyond tech play catch up.

“Prior episodes of sharply narrowing breadth have been followed by a catch-up from a broader valuation re-rating,” strategists led by Kostin wrote in a note dated June 9.

Since 1980, the S&P 500 has seen nine such key episodes, which were followed by gains in other stocks that ultimately benefited the index, they said.

Kostin now expects the S&P 500 to end the year around 4,500 points, increasing his target from 4,000 and implying gains of nearly 5% from its Friday close.

History may be on Kostin’s side. Bank of America Corp. strategist Savita Subramanian said last week that an analysis dating back to the 1950s shows the index advanced 92% of the time in the 12 months after it confirmed a bull market.