(Bloomberg) — Putting an end to the U.S.-China trade war is central to some of the bigger bull cases for stocks in America and abroad. With equity futures perking up on news a deal is close on tariffs, the following is a sampling of what strategists have said the impact might be.
March contracts on the S&P 500 and Dow Jones 100 rose 0.3 percent as of 10:33 a.m. in London, while Nasdaq contracts were up 0.4 percent. Negotiators are nearing an agreement that could lift most or all U.S. tariffs as long as Beijing follows through on pledges ranging from better protecting intellectual-property rights to buying American products, two people familiar with the discussions said earlier.
European stocks started the week on a positive note, too, as miners and media companies led the advance amid trade optimism. Investors are also looking forward to the monetary policy meeting of the European Central Bank on Thursday.
The S&P 500 could climb to about 3,020 should a “real deal” between the U.S. and China get struck, Bank of America strategists said in a note in February. That would exceed the September all-time high of 2,930. The reversal of 2018 tariffs would add 1 percent upside to companies’ per-share earnings growth, the strategists said.
About 250 points of upside could be realized in the S&P 500 if trade concerns thaw, Keith Parker, head of U.S. equity strategy at UBS, said in December when the benchmark was priced near 2,670. That would send the S&P 500 up toward 2,920 — a 4 percent gain from Friday’s close. Last week, he said the major average could reach new highs by the end of June, heading toward his year-end target of 2,950.
JPMorgan Chase & Co. strategists led by Marko