By Joel Jose and Akriti Shah (Reuters) - Morgan Stanley and Deutsche Bank expect the U.S. Federal Reserve to deliver interest rate cuts at all its three meetings this year, following data this week showing more modest inflation pressures. The two brokerages in separate notes said on Friday they now expect the Fed to cut rates by 25 basis points at each of its remaining meetings in September, October and December. The firms previously forecast one 25-basis-point cut each in September and December. The F ...

Core Insights - Deutsche Bank raised its year-end target for the S&P 500 to 7,000 from 6,550, citing boosted earnings per share estimates for 2025 and a 7% increase above the index's record close [2][6] - Barclays also increased its year-end target for the S&P 500 to 6,450 from 6,050 and its 2026 target to 7,000 from 6,700, driven by strong corporate earnings and anticipated interest rate cuts [6][9] Earnings and Valuations - Deutsche Bank projects earnings growth of over 9.5% this year and nearly 14% next year, which is above the average for typical non-recession years [4] - Analysts believe stock valuations will remain high as companies maintain elevated payout ratios and earnings resilience [4] Market Sentiment and AI Impact - The ongoing enthusiasm around AI, particularly following Oracle's strong guidance, is contributing to the bullish outlook for stocks [2][6] - Both Deutsche Bank and Barclays highlight the AI boom as a significant factor in driving stock prices higher [6][9] Labor Market Concerns - Barclays expressed caution regarding emerging labor market risks that could potentially offset strong corporate earnings and AI-driven growth [10] - Despite these concerns, Barclays anticipates three Federal Reserve rate cuts this year to support economic stability [10] Sector Preferences - Deutsche Bank favors large growth stocks, tech shares, and financials while remaining underweight in defensive sectors such as consumer staples, utilities, and healthcare [8]

Group 1 - Deutsche Bank raised its year-end target for the S&P 500 to 7,000 from 6,550, reflecting an optimistic outlook on earnings growth and interest rate cuts [2][6] - Barclays also increased its year-end target for the S&P 500 to 6,450 from 6,050 and raised its 2026 target to 7,000 from 6,700 [6][7] - Analysts project earnings growth of more than 9.5% this year and almost 14% next year, indicating strong corporate performance [4] Group 2 - The S&P 500 index reached a record high, driven by enthusiasm around AI and expectations of interest rate cuts by the Federal Reserve [3][6] - Companies are managing the impact of tariffs better than anticipated, with Deutsche Bank noting that the effects are seen as modest and manageable [3][4] - Analysts favor large growth stocks, tech shares, and financial shares while remaining underweight in defensive sectors like consumer staples and utilities [5]

Group 1 - Deutsche Bank AG's US distressed-products desk achieved over $100 million in profit this year by investing in securities related to EchoStar Corp.'s near bankruptcy and subsequent recovery [1][2] - The desk's profits were significantly boosted by EchoStar's announcement of wireless spectrum sales, expected to generate approximately $40 billion [2] - EchoStar has become one of the major profit contributors for Deutsche Bank's distressed-products desk in 2025 [2] Group 2 - Distressed debt trading is a crucial revenue source for Deutsche Bank, which has been recovering from previous losses and scandals [3] - The US desk has been involved in significant transactions, including financing for Marelli Holdings and debt restructuring for AMC Entertainment [4] - EchoStar's recent wireless spectrum sales to AT&T and SpaceX have concluded a lengthy distressed debt situation, allowing the company to address its $25 billion debt [5][6]

About this content About Emily Jarvie Emily began her career as a political journalist for Australian Community Media in Hobart, Tasmania. After she relocated to Toronto, Canada, she reported on business, legal, and scientific developments in the emerging psychedelics sector before joining Proactive in 2022. She brings a strong journalism background with her work featured in newspapers, magazines, and digital publications across Australia, Europe, and North America, including The Examiner, The Advocate, ...

Deutsche Bank upping its target from 6550 to 7,000. That's back to its original forecast from the beginning of the year and that is now the second highest target on the street. Here with us with his call is Binky Chada, chief global strategist at Deutsch uh Deutsche Bank.Good to see you Binky. Good to see you Mike. So your the path of your target somewhat reflects the way the market has experienced this year, right.I mean it's a a major scare. We needed to re-evaluate a lot of things. tariffs, the economy, ...

Core Viewpoint - Deutsche Bank has raised its target from 6,550 to 7,000, returning to its original forecast for the year, which is now the second highest target on the market [1]. Market Impact and Economic Factors - The market experienced a significant shock due to tariffs, prompting a reevaluation of various economic factors, including the economy and Federal Reserve policies [2]. - Despite initial negative expectations regarding tariffs, their impact on growth and inflation has been minimal, with earnings growth actually increasing in the second quarter [3]. - Companies have indicated that while the tariffs are a shock, they are manageable, leading to a return to the 7,000 target [4]. Market Positioning and Investor Sentiment - The market is currently at new highs, suggesting that many investors have entered the market, leading to an overweight position [5]. - Systematic strategies have contributed to the market being overweight, while discretionary investors have maintained a neutral position for the past two months, indicating potential upside [6]. Earnings and Buybacks - The combination of market positioning, potential inflows, and buybacks supports the argument for an 8% increase, aligning with the 7,000 target [6]. - If earnings remain stable, buybacks are expected to continue, further supporting market growth [6]. Interest Rates and Market Dynamics - The impact of potential rate cuts is under discussion, with considerations on whether cuts of 50 or 75 basis points by year-end will significantly affect the market [7]. - Current pricing in the market reflects expectations around rates, with medium to long-term rates being more influential than short-term rates [8]. - Near-term rate changes are viewed as less critical unless they deliver a significant surprise [9].

Core Viewpoint - Barclays and Deutsche Bank have raised their year-end targets for the S&P 500, driven by stronger corporate earnings, resilient U.S. economic growth, and optimism surrounding artificial intelligence [1][2]. Group 1: Target Adjustments - Deutsche Bank increased its S&P 500 target to 7,000 from 6,550, while Barclays raised its forecast to 6,450 from 6,050 [1]. - Barclays also lifted its 2026 target for the S&P 500 to 7,000 from 6,700 [4]. Group 2: Market Performance - The S&P 500 has risen 11.2% so far this year and touched a record high of 6,555.97 earlier [1]. - The index has rallied more than 30% from its April lows, supported by resilient earnings and investor enthusiasm around the AI boom [3]. Group 3: Economic Indicators - U.S. job growth weakened sharply in August, with the unemployment rate rising to a near four-year high of 4.3% [3]. - Signs of a cooling labor market and tame inflation have increased expectations for U.S. Federal Reserve rate cuts this year and next [4]. Group 4: Analyst Insights - Analysts expect equity valuations to remain elevated due to higher payout ratios and perceptions of higher trend earnings growth [2]. - Barclays anticipates three rate cuts before year-end, which may help offset labor market weaknesses [4].

Company Overview - Proactive is a financial news publisher that provides fast, accessible, informative, and actionable business and finance news content to a global investment audience [2] - The company has a team of experienced and qualified news journalists who produce independent content [2] Market Focus - Proactive specializes in medium and small-cap markets while also covering blue-chip companies, commodities, and broader investment stories [3] - The news team delivers insights across various sectors including biotech and pharma, mining and natural resources, battery metals, oil and gas, crypto, and emerging digital and EV technologies [3] Technology Adoption - Proactive is recognized for its forward-looking approach and enthusiastic adoption of technology to enhance workflows [4] - The company utilizes automation and software tools, including generative AI, while ensuring that all content is edited and authored by humans [5]

Summary of India Macro Outlook Post 50% Tariff, GST 2.0 & Strong GDP Data Industry Overview - **Industry**: Indian Economy - **Report Date**: September 4, 2025 - **Research Provider**: Deutsche Bank Key Points Economic Growth - Real GDP growth for April-June 2025 has exceeded expectations, but risks remain high for the second half of FY26 due to a 50% tariff shock [5][6] - Nominal GDP growth is projected to decline from 14.0% in FY23 to 12.0% in FY24, and further to 9.8% in FY25, with expectations of 9.0% or lower in FY26 [6][11] - The importance of nominal GDP growth is emphasized, as it affects corporate earnings, fiscal ratios, and debt dynamics [6] Inflation Trends - August CPI inflation is forecasted to rise to 2.23% YoY from 1.55% in July, with expectations of remaining subdued in the near term [7] - CPI inflation is projected to average 3.0% in FY26 and 4.5% in FY27, with a potential rise to 5.1% in April-June 2026 [8][9] - Core CPI inflation is expected to increase to an average of 4.4% in FY26, up from 3.5% in FY25 [9] Fiscal Outlook - GST 2.0 is expected to be fiscally sustainable, with higher consumption offsetting revenue shortfalls [10] - A revenue shortfall of INR 400-500 billion is anticipated in FY26, pushing the fiscal deficit to 4.50% of GDP [10][11] - FY26 GST collection is estimated at INR 11.8 trillion, a 10.9% YoY increase, but risks remain for lower tax collections due to moderating nominal GDP growth [11] Monetary Policy - The Reserve Bank of India (RBI) is expected to cut rates by 25bps on October 1, 2025, in response to growth risks [12] - The RBI's previous rate cuts have occurred despite positive GDP growth surprises, indicating a cautious approach to monetary policy [12] Currency and Foreign Exchange - The Indian Rupee is expected to depreciate mildly, with a target of 88.0 against the USD by the end of December 2025 [13] - India's FX reserves stand at USD 690 billion, but net reserves are lower at USD 635 billion, indicating potential vulnerabilities [14] Additional Insights - India's International Investment Position (IIP) is negative, with liabilities exceeding assets, highlighting the need for building FX reserves [14] - The report emphasizes the importance of qualitative assessments of GDP growth figures, particularly in light of deflator impacts [6] Financial Projections - The report includes a detailed financial forecast for various economic indicators, including GDP growth, fiscal deficit, CPI inflation, and trade balance [15] This summary encapsulates the critical insights from the Deutsche Bank report on India's macroeconomic outlook, focusing on growth, inflation, fiscal policy, and currency dynamics.