Cramer largely agrees with Bank of America’s bullish analysis and says next year could bring gains for the S&P 500

CNBC’s Jim Cramer responded to Bank of America’s bullish 2024 outlook on Tuesday, agreeing that it’s possible the S&P 500 could reach the 5,000 mark by the end of next year.

Bank of America strategist Savita Subramanian wrote on Tuesday that she expects 2024 to be a “stock picker’s paradise,” saying the bank is optimistic not because it expects the Federal Reserve to cut interest rates, but rather because of what she has already achieved.

“Broadly speaking, I agree with Savita Subramanian at Bank of America that we could go to 5000 on the S&P,” he said. “But other than the sentiment being far too negative, I’m non-committal about what might get us there, at least for now.”

The S&P 500, considered by most on Wall Street to be the best gauge of large-cap U.S. stocks, closed at 4,538.19 on Tuesday. At 5,000 the index will have reached an all-time high. After a difficult few months, the S&P 500 has seen a turnaround, rising 8.4% this month, marking its largest monthly increase since July 2022.

Subramanian wrote that the market had passed its “maximum macroeconomic uncertainty,” saying it had already absorbed significant geopolitical shocks and companies had adjusted to higher interest rates and inflation. She also wrote that election years tend to be good for stocks, but Cramer disagreed, saying he didn’t expect events in Washington to have a positive impact on the market.

While he didn’t agree with all of Subramanian’s points, Cramer said he was optimistic about the potential for large-cap stocks next year, aside from the “Magnificent Seven” tech stocks — Apple, Alphabet, Amazon, Nvidia, Microsoft , Meta and Tesla – which have dominated much of this year’s market action.

“I think next year could be about the other 493 stocks in the S&P, especially if the FTC stops being so aggressive in blocking mergers, because mergers would be the lifeblood of the next bull market,” he said.

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Disclaimer The CNBC Investing Club Charitable Trust holds stocks in: Apple, Alphabet, Amazon, Nvidia, Microsoft and Meta.