Goldman Sachs has increased the S&P 500 end-year objective to 3600 on the backbone of the “plunging risk-free rate”. The bank’s analysts, managed by David Kostin, quarrels that present market prices echo “not just the expected future income of returns but also the rate at which the earnings are discounted to current value.”

Furthermore, the banking giant now determines US GDP to rebound by +6.4% in 2021, following a reduction -5% in 2020. 

The bank is now estimating a 2021 EPS of $170, which is better than the present consensus of $165. This is largely due to anticipations that S&P 500 returns will rebound by 30% next year and 11% in 2022, after declining by 21% this year, still Kostin quarrels that the profit recovery will possibly be unstable among sectors.