Morgan Stanley Raises S&P 500 Price Target

NEW YORK (Reuters) – Morgan Stanley has increased its 12-month base case price target on the S&P 500 to 6,500, according to equity strategist Michael Wilson and other strategists in a note released on Monday.

The benchmark index was last at 5,893.

The note outlines expectations for the U.S. earnings growth to continue increasing into 2025, as the Federal Reserve is anticipated to cut interest rates next year and business cycle indicators improve further.

The strategists note, "A potential rise in corporate animal spirits post the election (as seen after the 2016 election) could catalyze a more balanced earnings profile across the market in 2025."

Republican Donald Trump recently secured a second term as U.S. president, having first been elected in 2016.

The firm maintains a bullish stance on "quality cyclicals," emphasizing that financials remain its "favored overweight" following an upgrade in early October.