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Equities

CAN S&P STILL DO A 7000 BY YEAR END?

ADMIN || 25th November 2025

Equities are back in the immediate post-Nvidia earnings mood after Fed Vice Chair John Williams’ dovish comments spurred a two-day rally. The ferocity of Monday’s uptrend, led by riskier stocks, suggests the bull run can keep going with recession angst evaporating.

Let’s remember how we got here, though. As the US government shutdown entered a second month, the negative impact on US growth became palpable with reduced consumer sentiment, air-traffic snarls and markets effectively flying blind as CPI and employment reports for October were cancelled. Hawkish rhetoric from Fed officials worried about inflation didn’t help either. That’s when equity volatility began to rise.

But it was the meltdown in cryptocurrencies that dramatically inflamed risk-off sentiment last week. Bitcoin and a broad range of tokens slid relentlessly as institutions pulled back and liquidity thinned. Financialization of a market is a double-edged sword, after all.

For equities though, the fact remains that Nvidia beat and markets initially rallied on that news. The crypto meltdown hasn’t shaken the ingrained buy-the-dip mentality for stocks, given we saw Tesla walk away today as the biggest Mag 7 gainer, outpacing even the now Berkshire Hathaway-backed Alphabet. It took a Fed put via comments from Williams to spark a Treasury market rally and revive positive equity sentiment. A December rate cut is now priced at 80% by swaps markets, sending the 10-year a whisker away from its recent 4% floor.

We believe last week’s pull back is healthy news. S&P might still hit our year-end target at 7,000 as stocks consolidate gains. If we see Tuesday follow through to extend this equities rally, that would signal risk-on sentiment is truly back. In that scenario, a climb to 7,000, now less than 5% higher from Monday’s close, looks attainable with relatively modest ease over the next six weeks.

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