RBC Capital Markets slashed its year-end outlook for the S & P 500 as concerns about economic growth continue to rattle investors. Lori Calvasina, the firm’s head of equity strategy, said the broad index should now end 2025 at 6,200, which marks a decrease of 6.1% from its previous expectation of 6,600. Her new forecast also implies just a 5.4% advance from where the benchmark finished last year. Calvasina’s call comes as investors contend with fears that economic growth is cooling after recent economic data and anecdotes raised red flags about consumer health. What’s more, President Donald Trump’s tariff policy has created uncertainty among traders and thrown the market into a tailspin over the last three weeks. “We had previously seen the [U.S.] equity market on a rocky path higher through year-end,” Calvasina told clients in a Monday note. “While we don’t believe that a pullback beyond the 10% drawdown that has already been sustained is inevitable, we do believe that the path for stocks between now and December has gotten rockier with stronger headwinds.” Calvasina pointed out that sentiment across a range of stakeholders has recently soured. Be it investors or consumers or business owners, she said there’s signs that their outlooks are turning more pessimistic, which can have a negative read-through for financial markets. .SPX 1Y mountain S & P 500- 1-year After the tariff-fueled rout seen recently, the S & P 500 is now down 3.7% year to date. The broad index has flirted with correction territory , which refers to a retreat of at least 10% from a recent high. That marks a turn from the strong market momentum seen over the last two years, with the S & P 500 hitting fresh all-time highs just last month. Taken all together, this landscape has resulted in what Calvasina described as a “tricky moment” for the U.S. equity market. “The vibes have helped us understand why the stock market has been getting hit so hard, and why concerns about the direction of the economy are rising,” she said. “But the vibes aren’t sending us a clear signal about whether, even with the S & P 500 down 10% from all time highs, a contrarian buying opportunity is at hand.” With the move, RBC joined Goldman Sachs in cutting its year-end S & P 500 target. Goldman also landed on a 6,200 estimate when revising its outlook last week. Goldman and RBC are both at the lowest end of market strategist forecasts, according to CNBC Pro’s exclusive tracker. The 6,200 estimate is about 6.2% below Wall Street’s average of 6,611.
A second major bank has cut its S&P 500 forecast on worries about economic growth
