The Tell: Wall Street firm cuts S&P 500 target. What Seaport says could go wrong by end of 2023

by | Aug 22, 2023 | Stock Market

While some of Wall Street’s top firms are maintaining their bullish year-end price targets for the S&P 500, one research firm has already reassessed its 2023 outlook for the large-cap benchmark as rising Treasury yields continue to weigh on risky assets.  See: S&P 500 has a new record high 2023 price target. Here’s a look at Wall Street’s official stock-market outlook.

Seaport Research Partners on Monday lowered their S&P 500 index
target for the end of this year to 4,500 from 4,650, citing increasing volatility in financial markets that signals growing liquidity concerns.  “The MOVE Index of the U.S. Treasury Volatility and the DXY Index of relative Dollar crosses are both rising which signals a risk-off backdrop to us as liquidity tightens,” said Victor Cossel, macro strategist at Seaport Research Partners.  The ICE BofA MOVE Index, which tracks fixed-income volatility, rose to a reading of 130.69 on Monday, the highest level since July 10, according to FactSet data. The ICE U.S. Dollar Index
which tracks the greenback’s performance against a basket of rivals, jumped 0.3% to 103.57 on Tuesday afternoon, putting it on track for one of its highest closes since June 12, according to FactSet data.  Meanwhile, the CBOE Volatility Index, or VIX
remains “subdued” relative to the uptick in bond and currency volatility measures, but Cossel and his team expect it to “catch up” with its global macro volatility peers (see chart below). They envision the current tactical pullback for the S&P 500 to extend further toward the 4,200 level in the near term. The S&P 500 was trading 0.3% lower, at 4,385 on Tuesday afternoon. The …

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