Bank of America believes the stock market could see another solid year with double-digit returns, and certain sectors are poised to enjoy outsized gains. The Wall Street firm set its 2025 S & P 500 target at 6,666, which implies a 11% upside from current levels. While the firm expects the broad benchmark to continue to climb, it said buying opportunities lie in individual companies that have the potential to return cash to shareholders and are beneficiaries from the new administration. “We see more opportunities in stocks than the index. In particular, we like companies with healthy cash return prospects and a tether to the US economy,” Savita Subramanian, BofA Securities head of U.S. equity and strategy, said in a note to clients. .SPX YTD mountain S & P 500 In particular, BofA said it’s bullish on financials, discretionary, materials, real estate and utilities. The firm expects bank stocks to benefit from a return in merger and acquisition activities as well as optimism around deregulation under a Trump administration. Meanwhile, real wage growth, a possible outcome from the president-elect’s protectionist policies, is a positive for discretionary spending, the bank said. Additionally, increased infrastructure spending during the new administration could provide a multiyear tailwind for old economy sectors like utilities, materials, energy and real estate, BofA said. BofA joined a group of Wall Street firms predicting double-digit returns after the presidential election. Deutsche Bank sees the S & P 500 hitting 7,000 in 2025 on the back of rising risk appetite. UBS recently said that it expects a “Roaring 20s” period for stocks to continue . Goldman also projected an 11% S & P 500 return for next year.
