Goldman Sachs Defies Earnings Bubble Fears With Optimistic Market Outlook

Goldman Sachs strategists are dismissing concerns about an 'earnings bubble' in the market, saying they believe profit growth will continue to support companies. According to Ben Snider and his team, earnings will grow at a slower pace next year but still reach 19% compared to this year.

The strategists predict that AI investments will start to fade as of next year despite rising capital spending. They also expect the S&P 500 index to rise to 8,700 points in 2027, which is more than a 1,000 point increase from Friday's figures.

However, not everyone agrees with this optimistic view. Top Wall Street analyst Ed Yardeni has trimmed his forecast for the end of the year, expecting the index to finish at 7,900 instead of 8,400 as previously thought.