NEWSLETTER

In our December newsletter, we always share the predictions made by major financial institutions for how the market will perform in the year ahead. This past December, we noted how off the mark the 2024 predictions were. Several major firms had actually forecasted a decline in the S&P 500 for the year 2024. Looking ahead to 2025, only one company in our survey of 11 projected that the S&P 500 would decline. After the first three months of the year, I checked to see if there were any updates to these optimistic full-year projections. Surprisingly, very few had made significant changes. Goldman Sachs lowered their year-end forecast to 6,200 from 6,500.  Barclays’ current target is a year-end close of 5,900. RBC maintained a projection of 6,600 but noted a potential bear case at 5,775.

•  UBS: 6,600 (Revised from 6,400 on January 24, 2025)
• HSBC: 6,700 (December 6, 2024)    
• J.P. Morgan: 6,500 (Maintained December 19, 2024)    
• Goldman Sachs: 6,200 (Revised from 6,500 on March 25, 2025) 
• RBC Capital Markets: 6,200 (Revised from 6,500 on March 25, 2025) 
• Morgan Stanley: 6,500 (Maintained December 19, 2024) 
• Citi: 6,500 (Maintained March 24, 2025) 
• Barclays: 5,900 (Revised from 6,600 on March 26, 2025)

The median estimate across Wall Street is around 6,500, compared to the Friday, April 4th closing value of 5,074. I find it interesting that even at recent lows, Goldman Sachs’ revised projection of 5,700 still allows for a 21.5% upside from the current 5,100 level. The median target of 6,500 suggests a 27.4% potential gain from where we stand now. So why the recent dip? I’m sure I won’t surprise anyone when I say it’s due to the dreaded “T word”—or perhaps more accurately, I should have said, the “U word.” Uncertainty in the stock market is something all investors must face, whether they’re part of the largest financial firms or individual retail investors. In this case, it’s uncertainty surrounding tariffs “ the T word”, which are notoriously difficult to predict. I’m far from a tariff expert, and no TV network, newspaper, or analyst can reliably forecast the outcome of a tariff policy. What I can say confidently is that long-term investing remains the best approach for managing your money.  

While my understanding of tariffs isn’t as strong as my investing experience, I’ve done extensive reading and want to share some key insights and projections. The expected GDP impact (not necessarily the market performance) from current tariff discussions is estimated to be between 0.5% and 1% in 2025. While no one wants to experience a slowdown, if that forecast proves accurate, is it worth the risk of trying to time the market and potentially miss the rebound? I remain fully confident in our four-pronged investment approach, which continues to include downside protection—something many of our clients have recently thanked us for. On Friday, April 4th, my son and partner, Scott Jr., along with our other partner, Justin Capetola, shared a thoughtful and in-depth explanation of our investment strategy via email. I encourage each and every one of you to watch and listen to the well-done podcast we sent out at 4:15 PM that day. Our approach, which has evolved over my 50 years in the business, still follows the same foundational principles, even as the markets have changed: 

1. Stay calm    2. Stay invested   3. Stay the course 

 We all understand that investing isn’t a one-way street. Stock markets go up, and they go down—that’s a certainty, and that’s how it will always work. Historically, the average peak-to-trough drawdown for the S&P 500 has been 14%. Trusted sources report that in the past 20 years, a correction of 10% or more has occurred in 10 of those years—half the time. (A correction is defined as a decline of 10%–20% from recent highs.) And again—no surprise—we’ve already experienced two 10% corrections in 2025. In my experience, when most investors exit the market, they rarely re-enter at the right time—if they come back at all. This often results in missing out on half or more of the potential gains they could have achieved by simply staying invested. If your portfolio is properly positioned, staying the course becomes a simple and effective strategy. One final truth: the longer you stay invested, the higher your returns tend to be.  

As always we appreciate the confidence you put in our team we welcome any questions or comments you have.  

 Sincerely,  

BBPWM 

*April 15th, 2005 was the date Blue Bell PWM was officially incorporated. We would love to have you celebrate with us – be on the lookout for an invitation to help us celebrate 20 years as your trusted investment advisors.