The S&P 500 recorded its worst week since 2020. The index could fall to 2,525 in a context of stagflation in the 70s, report economists at Societe Generale.
The S&P 500 could hit 3,300 before bouncing through the year
“Our bearish thesis on US equities reflects the following factors: a) the Fed hikes are taking place in an environment of slowing growth, and b) we have never seen hikes and quantitative tightening in the same year.”
“We see the fair value of the S&P 500 at 3,850 points, with a volatile profile. The index may reach 3,300 before bouncing later in the year.”
“We do not consider a recession or stagflation as a base case, but a typical recession would take the S&P 500 to 3,200 points, while a 1970s-style stagflation scenario could take the index to 2,525 points.”
Source: Fx Street
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