Bank of America Corp. (BAC) says signs are growing that the eight-year-old bull market in stocks and risky assets could soon come to an end.
And, as with all late-stage bull markets, the trick for investors is in getting the timing right.
The Standard & Poor’s 500 Index, a key benchmark for U.S. stocks, could peak at 2,863 during the first half of 2018, Bank of America analysts predicted in a report. That’s 8% above current levels.
But the second half could bring mostly gloom for investors, as the Federal Reserve tightens financial conditions by raising interest rates and shrinking its balance sheet. Volatility — a measure of the size of daily price swings — could rise from this year’s unusually low levels. Inflation is likely to increase.