US equities are set to hit 6,530 by end-2025, with AI and big tech driving growth, while Asia offers standout opportunities, says Eli Lee, chief investment strategist, Bank of Singapore, in a 2025 outlook.
According to the outlook, despite challenges, the broader uptrend in US equities remains intact, with the S&P 500 projected to climb to 6,530 by the end of 2025. The resilience of growth fundamentals and continued strength in key sectors such as Big Tech ( US tech companies: Alphabet, Amazon, Apple, Meta, and Microsoft) and AI-driven industries underpin the optimistic outlook, shared Lee.
The outlook highlighted the appeal of AI as a dominant narrative in 2025, with hyper-scalers ramping up capital expenditure and firms seeking to monetise AI innovations. Big Tech, Lee added, is poised for another year of robust earnings growth, fueled by strong demand in advertising, e-commerce, and cloud services.
Outside of the US, Asia ex-Japan equities present compelling opportunities for investors. “The fundamentals in China, Hong Kong, India, Indonesia, and Singapore are sound, and these markets benefit from compelling structural trends,” Lee explained.
Private markets and Asian emerging markets attract pension funds
In China, the bank advocated a “barbell strategy”, balancing investments in domestic-focused firms, quality yield stocks, and beneficiaries of stimulus policies with market leaders in the internet and platform sectors.
On fixed income, Lee cautioned against adding duration risk in portfolios, given the expectation of higher bond yields driven by sticky inflation and firmer US growth. He indicated that the Bank of Singapore would only consider extending the duration when the 10-year US Treasury yield reaches 5%.
Gold remains a favoured asset in the current environment, according to the outlook, reaffirming the bank’s 12-month price target of USD 2,900/oz. “Gold is an effective portfolio diversifier, particularly given uncertainties around US fiscal sustainability and elevated geopolitical risks,” added Lee.
