Deutsche Bank stated that even if the s&p 500 index does not replicate this year's brilliance by 2025, this benchmark index will still achieve an attractive double-digit return.

In a report on Monday, analysts predicted that the s&p 500 index will reach 7,000 points by the end of next year, which represents about a 17% growth potential from Monday's closing price of 5,969 points.

A team led by Bankim Chadha, the usa's chief equity and global strategist, stated: "We expect strong inflows into stocks (and bonds) to continue, driven by a strong risk appetite, although we anticipate a slowdown in the pace of growth."

So far, the index has risen by 25% due to the trading of popular large-cap technology stocks, positive data on the labor market, inflation, and GDP growth.

Looking ahead to 2025, Deutsche Bank analysts predict that the market's supply-demand backdrop will be supported by active investor activity and strong corporate buybacks. It is estimated that companies will buy back $1.3 trillion worth of their own stock from investors, up from $1.1 trillion this year.

In addition, there are many indicators showing that the stock market cycle has not yet reached its peak.

Chadha wrote: "We believe that multiple aspects of the cycle are yet to come, including the shift from destocking to restocking; a rebound in capital expenditures outside the technology industry; a manufacturing recovery; rising consumer and business confidence; a recovery in capital markets and M&A activity; accelerated loan growth; and growth in other parts of the world."

At the same time, the policy mix of the Trump administration may have both positive and negative components, and the sequence in which these policies are introduced will be important. Deutsche Bank expects tax cuts and deregulation policies to come before tariff policies.

As the main driving force behind the market rise, the earnings per share growth rate for s&p 500 component companies is expected to reach 11.6% next year, with earnings per share reaching $282, while the expected earnings per share growth rate for 2024 is 11%.

The bank stated: "Additionally, if global economic growth reaches a historical peak, then the earnings growth rate could rise to 17%, bringing s&p 500 earnings per share to $295."

Analysts suggest that investors increase their shareholding in financial, consumer cyclical stocks, and materials stocks. Deutsche Bank holds a cautious view on medical care, consumer staples, and telecommunications industries.

Deutsche Bank's outlook forecast puts it ahead of several bullish institutions on Wall Street. UBS Group and Morgan Stanley both expect the s&p 500 index to reach 6,500 points next year, while investment company BMO is preparing for it to reach 6,700 points.