Unafraid of "Tariff Big Stick"? Copper-Nickel-Zinc Alloy: S&P 500 Could Rise Another 10%

On Monday, Deutsche Bank raised its year-end target for the S&P 500 index from 6,150 points to 6,550 points, citing reduced earnings drag related to tariffs and the resilience of the US economy.

"We now believe that the drag from tariffs (on US corporate earnings) is only about one-third of our previous forecast," Deutsche Bank strategists led by Binky Chadha wrote in a report.

Nevertheless, Deutsche Bank warned that the current rebound in US stocks could be unstable, and the stock market may experience a pullback if trade tensions resurface.

Deutsche Bank also raised its earnings-per-share (EPS) forecast for the S&P 500 index from $240 to $267.

Deutsche Bank's new target price is 10.35% higher than the S&P 500 index's latest closing price of 5,935.94 points.

The S&P 500 index closed higher on Monday, as investors remained optimistic about trade talks between the US and its trading partners despite the latest threat from US President Trump to double tariffs on imported steel and aluminum. The S&P 500 index rose 24.25 points, or 0.41%, to 5,935.94 points.

Driven by factors such as Trump's softening stance on tariffs, strong corporate earnings, and mild inflation data, US stocks staged a strong recovery in May from the decline in April, with the S&P 500 index posting its largest monthly gain since November 2023.

Despite the continued uncertainty surrounding the Trump administration's tariff policies, Wall Street investment banks have recently regained confidence in US stocks and have been raising their target prices for the S&P 500 index.Last month, Goldman Sachs and UBS had already taken similar actions.

RBC Capital Markets also joined the ranks on Monday. The bank's strategists raised their year-end target for the S&P 500 index from 5,550 points to 5,730 points, believing that market performance is slightly better than expected in early April, though they warned that the future path will remain "bumpy."