Year-end S&P 500 to Reach 6000... AI Investment Expands to B2C

In the second half of this year, the U.S. stock market is expected to continue its bullish trend, with the S&P 500 reaching up to 6000 points. While the AI investment cycle led the U.S. stock market until the first half, it is anticipated that the second half will mark the beginning of AI's full-scale expansion into B2C (business-to-consumer) transactions.

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On the 18th, Hwang Su-wook, a researcher at Meritz Securities, stated in a report, "The top three U.S. market cap stocks in the AI industry?MSFT (AI software), AAPL (AI devices), and NVDA (AI capital investment)?each play a crucial role and are competitively driving a price rally," adding, "We expect a bullish market accompanied by the simultaneous growth of these three leading stocks and project an upper target price of 6000 points for the S&P 500 in the second half."

As a basis for this, he assumed that the expected 12-month (12MF) earnings per share (EPS) growth trend from the first half would continue into the second half. Researcher Hwang analyzed, "The S&P 500's expected 12-month EPS grew by 5.3% until May, and assuming this continues until the end of the year, a 13% growth is expected."

He continued, "The S&P 500's expected 12-month price-to-earnings ratio (PER) is 20.8 times," and added, "Considering that the peak of the 1990s tech cycle was a PER of 22 times just before the interest rate cut in October 1998 (which marked the beginning of a bubble formation after the rate cut), achieving 6000 points by the end of the year is possible."

The AI B2B investment cycle that continued until the first half is expected to persist. Researcher Hwang summarized, "The AI investment cycle led the U.S. stock market until the first half," and quoting Jensen Huang, he described AI data centers as factories producing new goods or services called AI.

He further analyzed, "Building data centers, laying power infrastructure to supply the necessary energy, and expanding carbon-free energy sources such as nuclear, wind, and solar power were the narratives driving leading stocks in the first half."

He viewed the second half as the starting point for AI's full-scale expansion into B2C. However, he noted that the core issue in B2C expansion is how to resolve personal data privacy concerns. He advised, "Big tech companies are driving on-device AI as the solution to this," and recommended, "Investors should keep this structure in mind when connecting investment ideas for the second half."