While the prevailing outlook by the big banks for 2018 and onward has been predominantly optimsitic and in a few euphoric cases, “rationally exuberant“, with most banks forecasting year-end S&P price targets around 2800 or higher, and a P/E of roughly 20x as follows…
Bank of Montreal, Brian Belski, 2,950, EPS $145.00, P/E 20.3x UBS, Keith Parker, 2,900, EPS $141.00, P/E 20.6x Canaccord, Tony Dwyer, 2,800, EPS $140.00, P/E 20.0x Credit Suisse, Jonathan Golub, 2,875, EPS $139.00, P/E 20.7x Deutsche Bank, Binky Chadha, 2,850, EPS $140.00, P/E 20.4x Goldman Sachs, David Kostin, 2,850, EPS $150.00, P/E 19x Citigroup, Tobias Levkovich, 2,675, EPS $141.00, P/E 19.0x HSBC, Ben Laidler, 2,650, EPS $142.00, P/E 18.7x … there have been a small handful of analysts, SocGen and BofA’s Michael Hartnett most notably, who have dared to suggest that contrary to conventional wisdom, next year will be a recessionary, bear market rollercoaster.
And then, there are those inbetween who expect a good 2018, but then all bets are off in 2019. Among them is JPM’s chief economist Michael Feroli who has published a special report, aptly titled “US outlook 2018: Eat, drink, and be merry, for in 2019…”
Here are the seven main reasons why JPM believes that the party will continue until December 31, 2018 or thereabouts:
Growth momentum at the end of 2017 is solid and global headwinds are unusually mild
This post was published at Zero Hedge on Nov 28, 2017.