After a year that made a mockery of every best-laid investment plan, the prognosticators of Wall Street could be forgiven for greeting 2021 with an abundance of caution.

Instead if there’s an oversupply of anything, it’s optimism.

Recovery. Revival. Rotation. Reset. These are the words dominating the annual stack of market outlooks from the world’s biggest banks and investment firms for the year ahead. Caveats abound, but the consensus is that after the Covid-spurred crash, the vaccine is setting the stage for a new period of economic growth—and rising asset prices.

-Bloomberg

• BMO Global Asset Management

  We continue to have a favorable view on equities for 2021 due to our expectations for a vaccine-driven economic recovery and revitalized global corporate earnings

• BMO Global Asset Management

  Our strategy is to be ready to overweight Europe but only after we see clear evidence of outperformance on the economy and earnings. The purchasing managers’ indexes will be important in this regard.

• Citi

  Valuation and earnings revisions appear stretched with a possible peaking, which do not bode well for share prices. We believe that the Street has pulled forward S&P 500 returns into the second half of 2020, leaving 2021 in a 3,700-4,000 trading range, with a year-end target of 3,800 using 10 different approaches.

• Credit Suisse

  We are initiating our 2021 S&P 500 price target of 4,050, representing 12.2% upside from current levels (10.8% annualized). This is based on EPS of $168 in 2021 (previously $155), and $190 in 2022 (previously $170).

• Credit Suisse

  We believe the fundamental case for tech remains compelling with faster sales growth, superior margins, robust FCF, and low leverage, and recommend a positive bias toward this group on an ongoing basis.

• Credit Suisse

  Non-cyclicals should lag in an improving economy as falling volatility supports higher P/Es for riskier assets, and rising rates makes their high dividend yields less appealing. The one exception is health care which should outperform given a more robust earnings trend.

• Evercore ISI

  Supported by increasing earnings, rising cash return and improving investors sentiment, we forecast the S&P will end 2021 around 4110.

• Evercore ISI

  2021 top line growth, driven by a rebound in consumer spending on services should be strong than currently expected. Split government in the U.S. limits the scope for changes to the tax code. Borrowing cost remain near all-time lows. Rapidly recovering earnings growth and management sentiment toward cash return will help boost buyback activity over the next year. Taken together, those forces leave us with a 2021 EPS estimate of $176, about $10 above current consensus.

• Fidelity

  Uncertainty over vaccine timings, the effects of monetary and fiscal stimulus, as well as earnings growth, may cause pockets of market volatility in 2021.

• Franklin Templeton

  We have a moderately positive view for equities in 2021. Investor sentiment and earnings forecasts for the first half of 2021 have become a bit exuberant, which will likely lead to consolidation and perhaps a slight correction early in the new year. Longer term, markets should head higher as the economy normalizes with the distribution of a vaccine and adjustment to a new presidential administration in the U.S.

• HSBC Asset Management

  Tech companies, which have reaped the rewards of lockdowns and social distancing, will continue to grow their revenues and profits as the shift to online appears here to stay. The healthcare sector, which took centre stage amidst the public health crisis, will likely continue to see success backed by strong expected earnings growth in 2021.

• JPMorgan

  We see the S&P 500 reaching 4,000 by early next year, with a good potential for the market to move even higher (~4,500) by the end of next year. Our 2021 EPS estimate is $178 (consensus $168.89) and 2022E EPS is $200 (consensus $196.71).

• JPMorgan Asset Management

  Earnings should rebound but overall U.S. equity returns may be constrained by high valuations. A cyclical rebound should produce at least a temporary rotation from growth to value.

• Morgan Stanley

  Across regions, we see 25-30% earnings-per-share growth and double-digit total returns through end-2021. We are overweight cyclicals and underweight defensives across regions, and expect U.S. small-caps to outperform large-caps. We think that EM and Asia-Pacific ex-Japan equities will lag DM slightly, but upgrade India to overweight. We see the S&P 500 at 3,900 by end-2021.

• Pictet

  Our models suggest that global equities’ earnings multiples could contract by as much as 15% next year, but this is likely to be more than offset by an approximate 25% surge in corporate profits.

• UBS

  We expect the wide-scale rollout of a vaccine in the first half of 2021 to enable global output and corporate earnings to return to pre-pandemic highs by the end of the year.

• UBS

  U.S. mid-caps and industrials should see higher earnings growth than U.S. large-caps.