Bank of America Forecasts a Bullish Rally on Wall Street in 2024 - Trillions of Dollars Ready to Deploy

•  trendspotteam

•  Apr 26 2023
 

Companies are already showing better-than-expected results in the first quarter, despite high interest rates, stubborn inflation, recession fears and a banking crisis. "More than $7 trillion of investment houses and private investors who enjoy safe investments plus interest in the meantime could roll over into the stock market."

Bank of America expects a strong rally in 2024 on the New York Stock Exchange, based on expectations of good results from the companies, along with trillions of dollars of investment houses and private investors "sitting on the sidelines" waiting for the right moment to enter Wall Street.

As long as economic conditions permit, Bank of America said, growth in listed companies will outpace growth in the economy itself. The bank noted that "the recent decline in U.S. Treasury yields may lead investors back to the stock market."

The bank emphasizes that the results of Wall Street companies so far in the first quarter are better than expected. So far, 25% of companies have published their results, of which 68% have exceeded profit forecasts and 75% have exceeded revenue forecasts. And that's a good sign for a stock market that continues to grow despite companies recently dealing with high interest rates, stubborn inflation, recession fears and a banking crisis that rocked Wall Street in March.

Bank of America explains that the trend in listed companies is ahead of the trend in the economy (whether it is a withdrawal or growth). The falls on Wall Street last year occurred before there were signs of economic weakening (there are now fears of a recession). And the positive results of the listed companies in the first quarter are ahead of the economic growth in the U.S. economy that the Fed expects next year.

"Corporate earnings growth typically occurs at a faster pace than the previous one," the bank said, adding that despite the collapse of Silicon Valley Bank last month and the ensuing crisis, the economy still has the right conditions for investing and lending.

The flow of money from central banks, governments and banks is starting to dry up (they pumped money into some of the banks that collapsed or were about to collapse last month in the US and Europe), but record amounts are waiting for investment houses," the bank added.

Bank of America expects that private companies and investment houses will also be joined by private investors, who in the meantime are taking advantage of the high interest rate in the economy, and are waiting on the sidelines with sums of money accumulated in various funds and deposits. The bank estimates that there are $5 trillion waiting to make the transition from safe investments plus interest back to the capital markets.

Please note that the article should not be considered as investment advice or marketing, and it does not take into account the personal data and requirements of any individual. It is not a substitute for the reader's own judgment, and it should not be considered as advice or recommendation for buying or selling any securities or financial products.

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