Market Call: From Dow 40,000 To Infinity & Beyond

The Dow Jones Industrial Average closed above 40,000 on Friday for the first time. It's on track to rise 50% to 60,000 by 2030, in our opinion (chart). The S&P 500 should rise by as much to 8000. That target could be achieved with a forward P/E of 20 and forward earnings at $400 per share, up 60% from an estimated $250 per share this year. We think that's possible in our Roaring 2020s scenario.

For the here and now, the Q1-2024 earnings season is over. Early on, the analysts' consensus estimate for S&P 500 EPS implied an increase of just 1.2% y/y for the quarter (chart). The actual result was a 6.3% increase.