FX168 Financial News (North America) reports that Stifel expects the S&P 500 Index to peak in the first half of 2025 and then decline by 10% to 15% in the second half.

The brokerage stated on Thursday (December 12) that slowing economic growth and stubborn inflation are its main concerns.

Stifel expects the USA's benchmark stock index to fall to the mid-5000s by the end of next year, a viewpoint that is more pessimistic than the expectations of Goldman Sachs and Morgan Stanley. Goldman Sachs and Morgan Stanley predict that the S&P 500 Index will close at 6500 points by the end of 2025. Currently, the latest trading price of the index is 6075 points.

Stifel's strategists point out that the stock market may see a correction due to the USA's real GDP growth slowing to 1.5% in the second half of 2025, as well as core personal consumption expenditure (PCE) inflation remaining above the Federal Reserve's target.

Stifel added, "The current environment does not seem to support sustained enthusiasm in the stock market; we tend to favor defensive sectors."

The S&P 500 Index has performed strongly this year, currently up about 27%, mainly benefiting from the significant rise of the so-called "Magnificent 7" driven by the AI boom and market expectations of interest rate cuts.

Stifel also expects that the Federal Reserve will pause the rate cut cycle at its policy meeting in January next year, keeping interest rates at 4%, which may pose risks to market trends by mid-2025.