I asked ChatGPT to predict the market. Here's what the AI chatbot says 2025 will bring for stocks, rates, bitcoin, and more.

There's been debate over whether the S&P 500 can continue its upward climb for a third year in a row, but ChatGPT seems to believe it will. The chatbot gave me a bullish forecast of 6,500 by 2025 year-end, citing robust corporate earnings growth and historic growth trends. With this estimate, ChatGPT joins the likes of big banks like Goldman Sachs, JPMorgan, Citi, and Morgan Stanley. The median price target among Wall Street strategists is 6,600, according to Bloomberg data.

ChatGPT's top sector picks for 2025 include information technology, healthcare, and consumer discretionary.

If I were an AI chatbot, I would bet on the technology sector, too. Jokes aside, tech outperformance is hardly a hot take, given how the AI megatrend drove markets in 2024. 2025 could be another big year for semiconductors, software, and IT services. ChatGPT was also bullish on the continued strength of the American consumer going into 2025.

Additionally, ChatGPT showed a preference for the underdog: healthcare was largely neglected by investors in 2024 and returned less than 1%. But the chatbot cited biotechnology developments, demand for pharmaceutical drugs like GLP-1 medications, and an aging population as catalysts for the sector.

ChatGPT couldn't commit to a singular answer here, predicting two or three rate cuts in 2025 for a target rate of 3.5%-4% at year-end.

For context, the Fed has indicated that they expect to cut rates by 50 basis points in 2025, most likely in the form of two rate cuts. Markets, meanwhile, are pricing in a single rate cut as the most likely outcome for 2025, according to the CME FedWatch tool.

If there's one thing American consumers hate, it's inflation. With prices up significantly over the last few years, voters listed the economy as their top concern coming into the 2024 election.

ChatGPT doesn't think 2025 will be the year when inflation is fully defeated, predicting that it would hover around the same levels as 2024. The chatbot said slowing wage growth and stabilizing energy prices will prevent inflation from getting out of control, but price gains will remain elevated.

Some Wall Street economists have given estimates within this ballpark, with UBS estimating 2025 year-end inflation to be 2.6%. Others are more optimistic — Goldman Sachs believes inflation will fall to 2.1%.

As of November 2024, CPI data showed that prices had risen 2.7% in the 12 months prior.

It turns out ChatGPT is a bitcoin bull. It predicts that bitcoin will continue its ascent and end the year in six-figure territory.

ChatGPT said increased institutional inflows to the asset will boost demand and liquidity. It also believes there are expanding use cases for bitcoin as a strategic asset for corporations (see: Microstrategy), or day-to-day transactional currency.

Market predictions are hard to get right, but the price of bitcoin is especially difficult to forecast. The cryptocurrency doesn't have any cash flows on which to base a valuation. Instead, much of bitcoin's price is contingent upon its widespread adoption. The price has been subject to volatile swings in excess of 70% to the downside and even wilder swings upward.

As a result, bitcoin price targets are looking suspiciously similar to randomly generated numbers. Forecasters are giving estimates ranging anywhere from $45,000 to $500,000.

I recently added bitcoin to my portfolio, so I'm hoping ChatGPT — or the analyst with the $500,000 price target — is proven correct.