Goldman Sachs cuts S&P 500 year-end target to 6,200 as economic outlook weighs on profit forecasts

A decrease of about 10 % in S&P 500 (^GSPC) pushed Wall Street strategies to reassess their upward views to 2025.

Late on Tuesday night, David Costin, a strategic head of the US shares in Goldman Sachs, became the first big name in the street that reduces its target price at the end of the year for the S&P 500 after this decrease, as Costin cut his goal at the end of the year to 6200 of 6500.

“We reduce the goal of the S&P 500 index at the end of the year 2025 to 6200 (from 6500) to reflect a 4 % decrease in our moderate people similar to the multiple P/E (20.6X from 21.5X),” Coston and his team wrote.

“The goal of our new index suggests a 11 % increase in prices during the balance of the year, similar to our return estimate at the beginning of the year, but from a lower starting point.”

Earlier this week, the S& P 500 entered almost in a correction area – which was defined as a 10 % decrease from its latest level – as fears of the health of the American economy and the uncertainty surrounding President Trump Trump shook the investor’s confidence.

Goldman’s Special Economy Team recently reviewed the expectations of GDP for 2025 to 1.7 % of pre -projection by 2.2 %, as the effects of definitions and political uncertainty have been affected by their expectations.

Kostin reported the reduction of GDP in its observation on Tuesday, saying that slow growth expectations led to a declining review of its estimate of the growth of the S&P 500 profits this year to 7 % of 9 %.

“Our revised estimates reflect the predictions of the recently reduced GDP growth for the American Economy team, a higher tariff rate, and a higher level of uncertainty, which is usually associated with the greater stock risk allowance,” Kosten wrote.

“Weak economic activity usually means the growth of weakest companies’ profits.”

Read more: What does Trump’s tariff mean for the economy and your wallet?

Costin pointed to an incentive that improves economic growth expectations, either clear of stronger economic data or a low tariff policy that can stimulate the rise in stocks. On Wednesday, the first sign of better economic data may have appeared as the most softened inflation reading of the main stock indicators in the open market.

Although Kostin may be the first strategy to reduce its goal at the end of the year for the S&P, Kostin is not the only strategy that recently warned that American stocks probably seem different from last year’s expectations.

“We have seen the American stock market on a higher rocky path until the end of the year, and we believed that our 6600 can absorb a 5 to 10 % decrease,” wrote the head of the stock markets in the United States of America, Lori Calvasina, in a memorandum of customers on Sunday.