Goldman Predicts FTSE 100 to Reach 9,000 on Potential Ukraine Peace

Goldman Sachs has raised its price forecasts for London’s FTSE 100 and the pan-European Stoxx 600, citing the possibility of a peace deal in Ukraine. The bank now expects the FTSE 100 to hit 9,000 within 12 months.

This outlook follows comments from US President Donald Trump, who indicated he would begin negotiations with Vladimir Putin to end the ongoing Russia-Ukraine conflict. Betting markets now estimate a 70% chance of a ceasefire this year, Goldman noted.

Goldman Sees European Equities Gaining on Ceasefire Hopes

Goldman anticipates a “modest” re-rating of European equities if a deal is reached, though it warned that the outcome remains uncertain. The bank also pointed out that Europe’s earnings outlook has not significantly improved despite the potential for peace.

Since Russia’s full-scale invasion in February 2022, the STOXX 600 has lagged behind the S&P 500 and MSCI World by 13% and 6%, respectively. Investor sentiment toward European equities has remained weak, with outflows recorded almost every week since the invasion began, Goldman highlighted.

The bank expects that a peace deal would lower risk premiums and energy prices while boosting consumer confidence and economic growth. European GDP could rise by 0.2% in a limited ceasefire scenario and by 0.5% in a more favorable outcome, according to Goldman.

Goldman has also revised its short- and long-term forecasts, raising its Stoxx 600 targets to 560, 570, and 580 over three, six, and 12 months. Similarly, it has lifted its FTSE 100 projections by 400 points across the board, now expecting 8,800 in three months, 8,900 in six months, and 9,000 within a year.

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