S&P 500 might surpass 5,600, according to HSBC, assuming a recession is averted

The S&P 500 has a 5,000 2024 end objective set by HSBC equity analysts, however, they recognise that a gentle landing might see the index rise much higher.

The revised objective suggests a possible upside of around 8% from the present levels.

According to HSBC's analysis, if a recession is avoided, the S&P 500 has demonstrated an average return of 22% between the first Federal Reserve pause and six months following the first rate cut.

“From now until the six months after the first rate cut, which we anticipate in 3Q 2024, history implies we might see another 20%+ return”, analysts noted.

The state of the market right now is consistent with this cycle, and even with the predicted slowdown in economic growth, a recession isn't expected for the United States.

Although the Federal Reserve's impending rate reduction presents strong benefits for American stocks, a cautious stance is still at play because of the country's election cycle, slowing economic growth, and lower-than-expected profit growth projections.

(Sources: investing.com, reuters.com)