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Market Extra: Here’s why Goldman says stock-market gains will be capped even as earnings rise

Corporate earnings will rise and the economy will expand in the next few years, but the stock market will see only limited gains, according to analysts at Goldman Sachs.

In a Thursday note, strategists led by David Kostin raised their S&P 500 earnings estimate for each of the next three years, but left the price target for the index unchanged at 2,850 for year-end 2018 and 3,000 by the end of 2019.

The analysts said that “stock market price appreciation will be constrained by tightening monetary policy, a flattening yield curve, rising trade tensions and the upcoming midterm congressional elections.”

The S&P 500 SPX, +0.19% has been unable to break out of its recent range, finishing with a loss of 0.6% on Thursday and down more than 4% from its all-time high set in late January.

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