U.S. Stocks Basic Scenario

US Stocks (S&P 500) Outlook for the future.

First, the market view is that

(1) Stock prices move in line with earnings per share (EPS).
(2) EPS will trend upward.
・According to the bottom-up forecast, that is the case
・Even with rate hikes, the economy is considered solid.
(3) In the easing/expansion period, EPS sits above 20 times; in the tightening period it comes down below.
(4) From the above, year-end stock price is thought to be 225.5 × 20 = 4,510.
(For reference, the S&P 500 on April 1, 2022 was 4,545.86)
From now, a slight decrease is expected. However, as the economy remains solid, EPS could become stronger than current forecasts, and stock prices may rise slightly above present expectations.

Nevertheless, there are few who anticipate a substantial surge in stock prices.

My view is different.