The Vanguard S&P 500 (VOO) ETF stock price has been in a strong bull run this year and is now hovering at its all-time high. It was trading at $585, a few points below the record high of $593. It is up by over 30% from its lowest level this year.
Wall Street analysts are bullish on S&P 500 Index
The ongoing VOO ETF stock price surge has attracted many Wall Street bulls, who believe that it has more room to go.
Analysts have boosted their S&P 500 forecasts. Goldman Sachs analysts expect the S&P 500 Index to surge to $6,600 this year, representing a 6% increase from its current level.
Morgan Stanley analysts predict it will rise to $6,500, while Bank of America, Citigroup, and Wedbush forecast it will surpass $6,500 this year.
These analysts cite the recent strong earnings season and potential for interest rate cuts by the Federal Reserve.
The most recent results showed that the average earnings growth by companies in the S&P 500 Index was about 11.8%. It was the third consecutive quarter that the index had double-digit growth.
The strong earnings growth was notable because it came after Donald Trump started his flagship policy on tariffs. As such, the average earnings growth was expected to be 4.3%.
Wall Street analysts also cite the strong tailwinds in the artificial intelligence industry, a sector that is seeing robust growth this year, which explains why companies like NVIDIA, Microsoft, Meta Platforms, and Palantir have done well.
Additionally, there are rising hopes that the Federal Reserve will start to cut interest rates later this year. Analysts expect the bank to cut rates in its upcoming September meeting. Goldman Sachs sees three cuts this year, while Morgan Stanley predicts 6 or 7 cuts next year.
The VOO ETF does well when the Fed is cutting rates because of the rotation from the bond market to equities.
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Wall Street legend warns of a bubble
Meanwhile, one top Wall Street legend is warning that the market was in the early stages of a bubble.
In a Bloomberg interview, Howard Marks, the billionaire founder of Oaktree Capital, said that the stock market was getting highly overvalued relative to fundamentals because there has been no significant market correction in 16 years. He said:
‘The biggest mistake in investing is that investors believe that the way things are today is the way will always be and the things that are happening will always continue to happen. Reversion to the mean is always a possibility.’
Marks believes that the VOO ETF still has more upside in the near term, but he expects it to have a correction in the next few years.
Howard Marks is one of the top legends in Wall Street. He established Oaktree Capital, a company with over $173 billion, and which is now mainly owned by Brookfield.
VOO ETF stock price analysis
The weekly chart shows that the VOO ETF stock price has been in a strong bullish trend in the past few months. After bottoming at $440 in April, the stock has recovered to $593.
It recently crossed the important resistance level at $557, its highest swing in February this year. Moving above that level was notable as it invalidated the double-top pattern.
VOO stock price has remained above all moving averages, while the Relative Strength Index (RSI) has continued rising. Therefore, the VOO ETF will likely continue rising as bulls target the key resistance level at $600.
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