U.S. investment bank Goldman Sachs (GS) is forecasting that the current bull market in stocks will continue into next year and that the S&P 500 index will reach 6,500 by the end of 2025.
Continued U.S. economic expansion and earnings growth will continue to drive U.S. equity markets to new heights in 2025, according to Goldman’s Chief Equity Strategist David Kostin.
Kostin sees the S&P 500 increasing about 10% from current levels and ending next year at 6,500. He previously forecast a 2025 S&P 500 target of 6,300.
Goldman’s latest forecast comes a day after rival investment bank Morgan Stanley forecast that the S&P 500 index could rise as high as 7,400 next year, which would be a 25% increase.
Morgan Stanley also sees U.S. stocks continuing to rise on the strength of corporate earnings and the American economy.
The S&P 500 has risen 24% so far this year and is currently trading near all-time highs due largely to the boom in artificial intelligence (A.I.) stocks such as Nvidia (NVDA).
The median estimate for where the S&P 500 index will be at the end of 2025 is now at 6,000, near the level it is currently trading at.
Kostin noted that, despite his bullish outlook, risks for U.S. equities remain high and include less interest rate cuts from the U.S. Federal Reserve and proposed trade tariffs.
Additional 2025 predictions from Kostin’s team at Goldman Sachs include that the “Magnificent 7” technology stocks will continue to outperform the rest of the S&P 500 next year.
And merger and acquisition (M&A) activity will pick-up in 2025 after several down years.
The stock of Goldman Sachs has risen 51% this year to trade at $587.99 U.S. per share.
