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January 14, 2025

Evercore ISI Highlights 2025 Market Surprises to Watch Under Trump’s Administration

As Donald Trump gears up to take office as the 47th President of the United States, strategists at Evercore ISI project intriguing market surprises for 2025. From unexpected highs in stock returns to shifts in bond yields, these insights offer a roadmap for investors.

1. S&P 500 Surges for a “Three-Peat”

According to Evercore, the S&P 500 may achieve a fourth consecutive year of 20%+ returns, countering expectations of heightened valuations and rising yields. Contributing factors include:

  • A robust surge in AI utilization spurring corporate growth.
  • Historical evidence suggests that “high valuation is not a bull market killer.”

Such optimism suggests enhanced market participation beyond the usual tech giants, fostering momentum across various sectors.


2. Stability in S&P 500 EPS Estimates

Contrary to predictions of declining earnings, Evercore remains optimistic about the S&P 500โ€™s EPS estimate holding steady at 274, influenced by:

  • Consistent profit margins.
  • Moderating dollar value boosting international growth.

If validated, the remaining stocks within the index could outperform the tech giants for the first instance since AI technologies like ChatGPT gained traction.


3. Bond Yields Nearing Change

While the 10-year Treasury yield is expected to linger in a 4-5% range, several factors could disrupt this stability:

  • Potential debt ceiling disputes.
  • Unexpected economic growth or inflation changes.

Such scenarios could foster volatility within fixed-income markets, prompting significant shifts in strategies.


Investor Insights

To stay ahead of these anticipated trends, investors should analyze historical market behavior and economic indicators. Tools will provide insights into sector-specific performances across previous cycles.


Concluding Thoughts

Evercore ISIโ€™s forward-looking assessment encourages a flexible approach toward investments as the global economy adapts to policy adjustments under Trumpโ€™s leadership.

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