Cramer broadly agrees with Bank of America's bullish analysis, says next year could bring gains for the S&P 500

• CNBC's Jim Cramer reacted to Bank of America's bullish prediction for 2024, saying that for the most part, he's similarly optimistic.
• Strategist Savita Subramanian wrote on Tuesday that the S&P could reach 5,000 by the end of next year, which would be an all-time high for the index.

CNBC's Jim Cramer on Tuesday reacted to Bank of America's bullish outlook for 2024, agreeing that it's possible S&P 500 could reach 5000 by the end of next year.

Bank of America strategist Savita Subramanian wrote on Tuesday that she anticipates 2024 as a "stock picker's paradise," saying the bank is bullish not because it expects the Federal Reserve to cut rates, but because of what it has already accomplished.

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

The S&P 500 is seen by most on Wall Street as the best gauge for large-cap U.S. stocks, and it closed on Tuesday at 4,538.19. At 5,000, the index will have reached an all-time high. After a tough few months, the S&P 500 has seen a turnaround, advancing 8.4% for the month, it's largest monthly increase since July 2022.

Subramanian wrote the market has moved past its "maximum macro uncertainty," explaining that it has already absorbed significant geopolitical shocks and companies have adapted to higher rates and inflation. She also wrote that election years tend to be good for equities, but Cramer disagreed, saying he doesn't expect any Washington happenings to make a positive impact on the market.

Even though he didn't agree with all of Subramanian's points, Cramer said he's optimistic about next year's potential for large-cap stocks other than the "Magnificent Seven" tech stocks — Apple, Alphabet, Amazon, Nvidia, Microsoft, Meta and Tesla— that have dominated much of this year's market action.

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

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