Citi Hints At Sp 500 Upside

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Citi Hints At Sp 500 Upside

Citi Hints At SP 500 Upside, Tells To Buy Any Pullbacks

The SP 500 index has touched a new high, mainly driven by the strong guidance and earnings from Nvidia. However, this upswing in the SP 500 has also raised doubts about whether the current valuation is justified or a mere bubble.

However, the strategists at Citi believe that the SP 500 will likely stay bullish. They added that valuations are only valid when we look at them and the forecasts for underlying growth. That's why it can be hard to predict future performance; take time at the various independently.

SP 500 Up By 7%

On a Y/Y basis, the SP 500 has increased by 7%, meaning the growth factors must be materialized. Additionally, Citi added that the SP500 forecasts for future earnings drive SP500 movement.

Another thing cited by the Citi experts is that a lot of data has already been priced in. That's why Citi added that there's a possibility that the SP500 will likely overshoot the target of around 5100. However, it would still be too soon to upgrade the 5700 price target yet.

Amidst all this and a bullish forecast by Citi, it makes sense for the investors to buy pullbacks of the SP 500. Citi also commented that the valuations of stocks from today are way lower than we saw during the 99-2000 era.

As a result, the SP500 index is not in a bubble at all, and it is safe to enter the market on pullbacks. Despite this optimism, deeper corrections can't be overruled as the index trades close to all-time highs.

Another thing that could boost the SP 500 is the conversion of spending into AI infrastructure into actual revenue. When that happens, the AI stocks will get a boost, translating into a higher SP 500. The Citi experts also highlighted that market broadening is also required at this stage.

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