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Some on Wall Street think stocks can hold their ground over the next year. But even those making such calls warn of serious risks.

The latest: Citigroup told clients this week that it believes the S&P 500 can hit 3,160 by this time in 2021. That would be a slight increase over current levels; the S&P 500 finished Tuesday at 3,145.

The bank noted “incessant” support from the Federal Reserve, which it said would continue to prop up riskier assets.

“Many risks are still out there, but the central bank will come in to mitigate the downside,” said Tobias Levkovich, Citi’s chief US equity strategist. He pointed to a quote often attributed to John Maynard Keynes: “When the facts change, I change my mind.”

At the same time, Citi cautioned that the next 12 months could be volatile, and that stocks will likely finish 2020 below current levels.

“There are various risks to share prices that should not be ignored,” the bank said.

On the list: Another wave of Covid-19 cases that triggers new shutdowns or a slower economic recovery would be “challenging,” Citi said. It’s also monitoring trade tensions and weak year-over-year comparisons (as opposed to quarter-over-quarter growth) that could spook traders.

The US election is coming into focus, too. Fund managers are racing to assess the costs and benefits of a potential Joe Biden presidency, weighing more predictable trade policy against likely higher taxes and regulation. For now, “the current zeitgeist does not seem to be all that worried about a possible Biden presidency,” Citi said.

The BlackRock Investment Institute also changed its position this week, downgrading US stocks to “neutral.” The asset manager’s strategists cited a surge in coronavirus cases across the Sun Belt and the potential for lower stimulus support from Congress, which they said makes it less likely US stocks can keep beating other markets.

“We now see a risk of more muted performance in line with global equities on a tactical horizon,” BlackRock said.

But the asset manager is not actively encouraging clients to sell due to the makeup of the US market. The United States benefits from “a high concentration of quality companies,” particularly in the tech and communications sectors, which are poised to benefit in a post-pandemic world, BlackRock said.

Investor insight: Amazon (AMZN) shares hit an all-time high earlier this week, and the Technology Select Sector SPDR ETF (XLK), which tracks the sector, is up more than 15% this year. For the S&P 500 to hold onto its gains, Silicon Valley stocks need to stay in favor.

Gold tops $1,800, hitting its highest level since 2011

Stocks have been surging on optimism about a potential economic rebound. Elsewhere, however, investors are showing signs of concern.

The price of gold has jumped above $1,800 an ounce, reaching its highest level since 2011. The metal is now creeping toward a record high of more than $1,900, having soared nearly 19% so far in 2020, my CNN Business colleague Paul R. La Monica reports.

Gold’s surge is a bit curious given the comeback in the broader market. The pop in prices earlier this year made more sense since gold often tends to do well in times of financial stress, when fear is prevalent.

But investors aren’t in panic mode right now. The CNN Business Fear & Greed Index, which tracks market sentiment, has a “neutral” reading, and has improved slightly over last week.

So what’s happening? Some investors may be hedging their bets given the skepticism that belies the fragile recovery. Buying gold could guard against a stock market pullback if the rebound in earnings and the economy doesn’t materialize in 2021 as expected.

Traders may also be betting on an eventual surge in inflation. Gold prices tend to soar when the Federal Reserve keeps interest rates extremely low, as it’s doing now.

UBS strategist Joni Teves, who told clients in a recent note that it was only a matter of time before gold passed the mentally-significant $1,800 level, said investors may now decide to take a breather and net profits. But the risk-reward case for gold will still look good to many.

“Market participants could simply look through recent strong data and focus instead on the expectation that weakness would resume and linger for longer,” Teves said. “This is likely to draw even more interest.”

Deutsche Bank’s $150 million Epstein fine

Germany’s Deutsche Bank, no stranger to scandals, has been slapped with another fine — this time for its ties to accused sex trafficker Jeffrey Epstein.

New York regulators fined Deutsche Bank $150 million Tuesday and slammed the lender for “mistakes and sloppiness” in its relationship with Epstein, my CNN Business colleagues Matt Egan and Erica Orden report. The penalties also relate to Deutsche Bank’s relationship with Danske Bank and FBME Bank, the subject of money-laundering investigations.

Authorities said Deutsche Bank’s “significant compliance failures” allowed Epstein to conduct hundreds of transactions totaling millions of dollars that should have prompted additional scrutiny.

See here: Among several red flags, Epstein was using more than $200,000 in cash annually, per regulators.

The penalties are the first enforcement actions by regulators against a bank for dealings with Epstein. In a statement, Deutsche Bank acknowledged its “error of onboarding Epstein in 2013 and the weaknesses in our processes, and have learnt from our mistakes and shortcomings.” The bank said it immediately contacted law enforcement to offer assistance after Epstein’s arrest.

Drama at Deutsche Bank: Germany’s biggest lender has a history of regulatory trouble. In 2017, the bank was hit with $630 million in penalties from the state of New York over a $10 billion Russian money laundering scandal. It also reached a $7 billion settlement in late 2016 with the US Justice Department over toxic mortgage assets, about a year after it agreed to pay $2.5 billion in penalties over interest rate manipulation.

Up next

The latest data on US crude oil inventories arrives at 10:30 a.m. ET.

Also today: UK Chancellor Rishi Sunak is due to unveil new relief measures to boost the struggling British economy.

Coming tomorrow: Europe’s finance ministers meet to discuss the bloc’s recovery plan following news that the recession looks worse than expected.