S&P 500's 2025 Outlook: Volatility, Growth, and Policy Impacts

The S&P 500 has experienced a rare two-year streak of over 20% gains, but Bank of America's strategist Michael Hartnett warns of potential volatility in 2025. The market could face a significant move, influenced by a "boomy" economic backdrop, favorable bond yields, and political incentives. However, stretched valuations and a possible "inflation boom" phase could pose risks. The S&P 500's high valuation and concentration in tech giants suggest a peak may be near, with inflation potentially returning as a dominant theme.