Julian Emanuel, senior managing director of Evercore ISI, said that despite the difficult market conditions, the economy is likely to avoid a recession amid healthy credit markets and continued growth.
"The increase in stock indices will depend on the ability to "ignore" macroeconomic news and focus on the still confident growth of profits," Emanuel said.
According to his forecasts, the S&P 500 index will rise to 4,800 points by the end of this year. Yesterday, the index ended trading at 3,940 points. However, Emanuel added that his forecast also depends on a decline in the yield of 10-year US Treasury bonds and the end of the year at 3%.
"The main reason for the last stock market crash - since the beginning of 2022, the S&P 500 index has fallen by about 20% - were retail investors who were overly exposed to the shares of technology companies. If the sale of these shares stops, we may see a recovery in stock markets," Emanuel said.
Meanwhile, Emanuel added that retail investors are likely to return to stocks later this summer when they realize that employment remains high and inflation is peaking.