Barclays has cranked up its 2024 S&P 500 target to 5,600 from 5,300, banking on tech giants to deliver robust profit growth. This adjustment underscores the bank’s optimism, setting the stage for a potential market rally driven by impressive earnings stats from major technology players.
Barclays expects Big Tech to be the locomotive for profit growth with a lofty 34x multiple. With a 2024 EPS estimate of $241, the rationale is clear—consistent earnings growth and positive forward revisions point to a strong performance. Barclays strategists highlight that such a multiple is reasonable given the sector’s consistent earnings revisions. Simply put, they’re betting the farm on tech’s ability to outpace the broader market.
The stakes are high. A stellar performance from Big Tech could catapult the S&P 500 to an eye-popping 6,100, whereas a miss could see it languishing around 4,950. The implications are profound—earnings reports will be the deciding factor, making this a must-watch sector.
Despite concerns over higher interest rates, Barclays remains bullish, expecting inflation to normalize while the economy stays resilient. If macroeconomic factors align favorably, the market’s bullish trend could sustain, reinforcing potential gains.
Macro moderation likely to accelerate ex-Tech EPS growth to the end of the year
Venu Krishna
This hurricane of optimism is backed by significant insights and data reflecting Barclays’ strong market confidence. Krishna’s commentary underscores expectations that macroeconomic moderation will bolster earnings growth, particularly outside the tech sector, providing a broad-based lift.
Barclays isn’t just putting all its eggs in one tech basket. They’re also bullish on utilities, another sector poised for above-average EPS growth in FY24. This dual-sector strategy offers a diversified play for investors looking to capitalize on multiple growth engines, making utilities a reliable growth hedge against tech volatility.
Even looking beyond the immediate horizon, Barclays sets a 2025 S&P 500 target at 6,500. Pegged on a 24x multiple of their 2025 EPS estimate of $268, this long-term view underscores their confidence in sustained earnings growth and moderated macroeconomic headwinds. The vision places heavy emphasis on EPS growth as a primary driver for future market performance, showcasing the depth of Barclays’ strategic foresight.
Let’s break down the key numbers driving Barclays’ bullish outlook:
| Category | Data |
|---|---|
| S&P 500 Target 2024 | 5,600 |
| Previous S&P 500 Target 2024 | 5,300 |
| Upside Compared to Monday’s Closing | Less than 1% |
| S&P 500 Year-to-Date | Up 16% |
| Technology Sector Performance | Up 29% |
| Target for S&P 500 2025 | 6,500 |
| Potential Increase 2025 | 168% from current |
| Utilities Sector Outlook | Above-average EPS growth in FY24 |
| Barclays Half Year Results 2024 | To be announced on August 1, 2024 |
Stay sharp, market enthusiasts! Barclays is betting big on 2024, setting up what could be an exhilarating ride for investors. Keep those portfolios balanced, and let’s see where this bullish forecast takes us!