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"Despite investor focus on the prospective policy implications
of the Biden presidency, the vaccine for COVID-19 is a more
important determinant of the path of both the economy and stock
market in 2021," the U.S. investment bank wrote in a note to
clients.
It sees the S&P 500 hitting 4,300 at year-end 2021, a 21% jump
from Tuesday's closing levels.
In Europe, Goldman expects a strong bounce in profits in 2021 as
lockdowns ease and populations start to be vaccinated. It raised
its 12-month target for the STOXX 600 <.STOXX> to 430 points, an
11% jump from current levels.
Value stocks, typically companies that are more sensitive to
economic cycles, have been soaring since Pfizer's announcement
on Monday of positive data from its vaccine trial, raising hopes
of an economic recovery.
Goldman also raised its 12-month target for London's top FTSE
100 <.FTSE> share index, which like other European benchmarks is
heavy in value stocks, to 7,200 points, a 13% upside from
current levels.
"We see the improved macro and commodities environment as
supportive going forward," it said, adding that value sectors
represent more than a third of the FTSE 100 index.
JPMorgan said on Monday that it expected the S&P 500 to hit
4,000 points by early 2021.
(Reporting by Thyagaraju Adinarayan and Danilo Masoni; Editing
by Tommy Wilkes and Elaine Hardcastle)
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