Bank of America warns: S&P 500 price-to-book ratio approaches the peak of the 'dot-com bubble' era, cryptocurrency and US stocks overheated alarm bells ringing..

Bank of America strategist Michael Hartnett recently pointed out that the U.S. stock and encryption markets are overheated, describing them as "bubbles" and that the current S&P 500 equity-to-equity ratio has climbed to 5.3 times, just one step away from the 5.5 times peak of the tech bubble in March 2000. (Synopsis: Amazon or invest 5% of assets in BTC? CZ pro-reply: Accept BTC payments, it's very simple) (Background added: Michael Saylor shouted: The United States should "dump all gold reserves": the government can afford to buy 25% of the total BTC) After Trump was elected president of the United States, the cryptocurrency and U.S. stock markets have been stimulated by this, showing an upward trend and continuing to update all-time highs. However, in this singing and dancing financial market, the vast majority of investors believe that the market can continue to rise, but some investors are worried that a huge financial bubble is gradually forming. Bank of America: U.S. stocks and cryptocurrency are full of bubbles According to Bloomberg, Bank of America (BofA) strategist Michael Hartnett recently voiced his concerns, saying that the strong Rebound in the U.S. stock market and the cryptocurrency market could overheat these assets. According to Bloomberg data, the S&P 500's equity-to-equity ratio has climbed to 5.3 times in 2024, just one step away from the 5.5 times peak of the tech bubble in March 2000. In addition, Hartnett specifically noted that if the S&P 500 approaches 6,666 points in early 2025 (about 110% of the current index, which is currently 6,090), it may face a high risk of "over-rise". However, he also mentioned that Bank of America's current bull and bear indicators show that global investors have not yet shown significant market excitement. Wall Street banks predict: U.S. stocks rise at least 5% next year But on the other hand, there are also a number of large banks (banks, investment banks) on Wall Street that have recently released their market forecasts for the S&P 500 index in 2025, most of which are still slightly bullish. According to TKer.co editor Sam Ro's collation, the forecasts of the 14 major banks are as follows: Swiss bank UBS, target price of 6,400 points: In the first half of 2025, the stock market may face slight downward pressure due to the slowdown in the US economic rise. Performance is expected to improve in the second half of the year as corporate earnings expectations are adjusted to more realistic levels Morgan Stanley, 6,500 target price: Investors need to be flexible in response to changes in market leadership due to uncertainty over election results. The Benchmark scenario has a target of 6,500 points, the Bull Market scenario has 7,400 points, and the Bear Market scenario has 4,600 points. Goldman Sachs, 6,500 point target: Net profit margin is expected to expand by 78 basis points to 12.3% in 2025 and 12.6% in 2026. The Trump administration's likely tariffs on auto imports and some Chinese imports, as well as a 15% corporate tax rate for domestic manufacturers, will offset the impact on earnings. JPMorgan Chase, 6,500 Point Target: U.S. stocks will benefit from continued business cycle expansion, AI-driven earnings rise, global Central Bank easing, and the end of the Fed's quantitative tightening. Moreover, U.S. households have benefited from a tight labor market and record wealth levels, but geopolitical uncertainty and the evolution of policy agendas have added to the complexity. CFRA, 6,585 point target: Based on US real GDP rise 2.4%, S&P 500 operating earnings rise of 13%, and continued decline in inflation and Intrerest Rate, the market still has room to rise. However, with valuations at a high level relative to the 10-year average, full-year rise expectations are below average. Royal Bank of Canada, 6600 point target: stable economic rise, earnings rise, political favourable information and falling inflation will support the stock market to the upside and maintain a high P/E ratio. Barclays Bank, 6,600 point target: For the US equities, we think the positive macroeconomic factors will outweigh the negative next year. We expect most sectors to be impacted by deflationary pressures and a slowdown in the non-US economic rise in 2025, but the performance of big tech companies will remain positive for equities. Bank of America, target price of 6,666: ready for the peak of the cyclical Bull Market. The nine drivers include: (1) a red wave (Republican win), (2) Fed rate cuts, (3) accelerated profits, (4) a repatriation of manufacturing, (5) productivity cycles, (6) a shift from everyone spending money on technology to spending money on technology in all areas, (7) urban infrastructure renovation to attract businesses, (8) capacity constraints due to chronic underinvestment in manufacturing, and (9) the lightest allocation of cyclical industries since the global financial crisis. BMO, 6,700 target price: Bull Market can, will and should slow down from time to time, and such a digestion period will further strengthen the long-term healthy foundation of the Bull Market. As such, we believe 2025 will be characterized by a more normalized return environment and a more balanced performance across sectors, size, and style. HSBC, 6,700 target price: We expect equity returns next year to be concentrated in earnings rise, as valuations are already too high...... Overall, we expect the U.S. economy to be resilient despite a slowdown and to achieve a 9% earnings rise, accompanied by some margin expansion. Deutsche Bank, 7,000 point target: The market is focusing on indicators at the end of the cycle, which is starting to turn around. We believe that some cyclical factors have not yet fully functioned, including from destocking to restocking, capital expenditure outside of technology, capital markets and M&A activity, loan rises, and rises in the rest of the world. Due to the positive and negative impact of the new government's possible policy changes on RISE, we believe growth will remain a priority. Yardeni Research, 7,000 point target: After Trump won the presidential election in 2016, we observed that the economy and stock market are full of "animal spirits," the term used to describe spontaneous optimism. Now, with Trump's re-election, this animal spirit is back. Capital Economics, 7,000 point target: These forecasts are based on the assumption that the US economy will not prevent the bubble formed by the AI boom in the stock market from continuing to inflate. While we will not raise our forecasts just because of the rise on the index or the positive reaction to the popular victory, we believe its policies could have a net negative impact on the rise in the US and beyond. Wells Fargo, 7,007 point target: Overall, we expect the Trump administration to deliver an increasingly favorable macroeconomic environment for equities, while the Fed will slowly cut interest rates. In short, it's a backdrop to the stock market's continued rise. Overall, the banks are generally optimistic about the S&P 500's 2025 target price, but considering economic policy, inflation rate and other factors, the market forecast is somewhat divergent, and the target price range is 6,400 to 7,007 points, which translates to a rise range of 5%~10.5%. 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