Goldman Sachs strategists expect profit growth to drive the S&P 500 index higher.

Goldman Sachs strategists believe that the U.S. stock market still has room to rise, expecting the S&P 500 index to reach 7,600 points by the end of the year, with profit growth being the main driving force. Led by Ben Snider, the team stated that given the current market pricing reflects economists’ forecasts of “steady but below-trend” GDP growth, investors are advised to shift their focus to long-term growth companies rather than cyclical companies. The strategists also added that, driven by continuously upward revisions of earnings expectations, the U.S. stock market has hit new highs, while valuation multiples remain below pre-conflict levels. (Bloomberg)

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