Dow Jones financial giant Goldman Sachs appeared set early Friday to add to gains from a breakout on Wednesday. Elsewhere, BAC stock broke out following an upgrade for Bank of America. GS stock moved up less than 1% in Friday's premarket trade.
BofA on Thursday lifted its price target on GS stock to $412 from $388 and maintained a buy rating on shares. The price target increase followed Wednesday's Federal Reserve forecast calling for three interest rate cuts next year.
Wells Fargo also raised its price target on Goldman Sachs by $3 to $393 on Thursday and kept an overweight rating on the shares. The downward re-rating of bank stocks should reverse in 2024, analyst Mike Mayo wrote in a research note. He believes interest rate, recession and regulation fears have "overtaken the reality of performance." Since 2019, banks increased core earnings by 15%, even while bank stocks fell more than 20% and underperformed the S&P 500 by 65% during that period.
Elsewhere Thursday, Odeon Capital upgraded Bank of America to buy from hold with a $37.94 price target. Fed Chairman Jerome Powell's statements were "relatively clear," noting the tighter for longer policy "may be over," the firm wrote in a research note. Odeon capital expects the next major move for interest rates to be lower.
BAC Stock, Goldman Sachs Price Action
GS stock jumped 5.7% Thursday to mark its seventh consecutive day of gains. Goldman shares climbed 2.9% Wednesday to close above a 361.62 buy point for a cup base. Thursday's spike pushed GS stock beyond the current buy zone. GS shares are up 12% in December and have a year-to-date gain of not quite 12%.
BAC stock leapt 6% Thursday, adding to its 4.2% gain Wednesday. Shares on Wednesday broke out of a cup-with-handle base after surpassing the 31.52 buy point. BofA is up 9% this month and gained 2.6% in 2023.
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