Key Takeaways
- Oppenheimer has significantly raised its year-end 2025 S&P 500 (SPX) target to 7,100, forecasting a third consecutive year of 20% gains driven by robust fundamentals and AI-driven efficiencies.
- Ireland's GDP unexpectedly contracted by 1.0% quarter-over-quarter in Q2, missing estimates of 1.5% growth and raising concerns about its economic health amidst global uncertainties.
- UK retail sales continued their downturn in July, marking the tenth consecutive month of decline, though the pace of contraction slowed slightly.
- Over 250 UK Members of Parliament (MPs) have signed a letter urging the Prime Minister to recognize a Palestinian state, intensifying political pressure on the issue.
- UK Prime Minister Keir Starmer is set to press US President Donald Trump on zero steel tariffs in their meeting, aiming to finalize a trade deal that has seen partial success in other sectors.
Oppenheimer has demonstrated significant bullishness on the S&P 500 (SPX), lifting its year-end 2025 target to 7,100. This projection anticipates a third consecutive year of 20% gains for the benchmark index. The firm's Chief Investment Strategist, John Stoltzfus, attributes this optimistic outlook to the Federal Reserve's successful inflation management, resilient economic growth, positive business activity, strong consumer behavior, and job creation. Oppenheimer also foresees S&P 500 earnings growing by 10% to $275 in 2025, up from a projected $250 in 2024. The investment bank highlights artificial intelligence (AI) as a transformative force that could drive significant efficiency and productivity improvements across all sectors, likening its impact to that of the automobile in the 1920s.
In contrast to the optimistic market outlook for the US, Ireland's economy experienced an unexpected setback in the second quarter of 2025. Provisional data shows a -1.0% quarter-over-quarter contraction in GDP, significantly missing the estimated 1.5% growth and a sharp decline from the previous quarter's 7.4% expansion. Year-over-year GDP growth also slowed to 12.5% from 20.0%. This downturn raises concerns about the Irish economy's resilience, particularly given its deep economic ties to the US and the potential impact of rising protectionism. While modified domestic demand, a more accurate gauge of Ireland's domestic economic health, has shown strength, global uncertainties and trade policy shifts pose considerable risks.
Meanwhile, the UK retail sector continues to face challenging conditions. The Confederation of British Industry (CBI) reported that retail sales volumes fell at a firm rate in July, marking the tenth consecutive month of decline. Although the pace of decline moderated from June's sharp drop, the persistent downturn underscores subdued consumer demand, driven by elevated price pressures and economic uncertainty. Retailers also anticipate sales to continue falling at a broadly similar pace in August.
In the political arena, UK Prime Minister Keir Starmer is set to meet US President Donald Trump, with key discussions expected to include the ongoing issue of US steel tariffs. While a previous trade agreement in June reduced tariffs on UK auto and aerospace imports, a consensus on steel imports was not reached, leaving tariffs at 25%. Starmer aims to press Trump for zero steel tariffs, a move that would benefit the UK steel industry. Separately, a significant cross-party initiative has emerged in the UK Parliament, with 254 MPs signing a letter urging the Prime Minister to recognize a Palestinian state. This collective action, spearheaded by Sarah Champion MP, reflects growing parliamentary pressure for the UK to take a definitive stance on Palestinian statehood, emphasizing its potential symbolic impact given the UK's historical connections and UN Security Council membership.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.