Deutsche Bank (DB, Financial) has a positive outlook on the S&P 500 index and forecasts it to end the year at 7,000 by the end of 2025. This is 17.3% higher than the current level of 5,969.34. It largely depends on healthier corporate earnings growth, large inflows, and good buybacks, which are also expected to be sustained over the next two years.

Barclays also hiked the 2025 estimate to 6,600 from 6,500 on a strong rebound in the US economy, declining inflation rate, and growth in mega-cap tech earnings. To support equities, the bank expects macroeconomic variables such as the federal fund rate, a form of monetary easing, and stabilization on political issues due to the post-election period.

Deutsche Bank analysts expect the S&P 500 earnings per share to be $282 by 2025, affirming the market's sound demandsupply ratios. Other big lenders like Goldman Sachs and Morgan Stanley have also revealed that the index may touch 6,500 points by 2025 due to stabilizing economic growth and the Fed's aggressive rate-cutting cycle.

Despite such a confident scenario, the sources and type of demand as envisioned point to structural demand, bolstered by technology advancement and economic stability but overlaid with caution on downside risks around the global financial system environment.

This article first appeared on GuruFocus.