Wall Street's crystal ball

Between a historic stock market crash in April, the unprecedented rebound afterward, and literally everything going on in crypto, it feels more and more like nobody knows what will happen next.

But if anyone is going to try to predict the future, it’s Wall Street. Analysts are forecasting another year of stellar gains for equity investors as the Fed cuts rates, AI continues to buoy the market, and strong corporate earnings pave the way to dollar signs.

Then again, fears of an artificial intelligence bubble, tariffs going to the Supreme Court, and continued crypto volatility means that every forward-looking forecast should be taken with a grain of salt.

The most-bullish strategists on the Street hail from Oppenheimer, forecasting the S&P 500 rises to 8,100 by the end of this year, good for about an 18% gain from today’s prices. The most bearish, on the other hand, are the folks at Stifel Nicolaus & Co. who think the index finishes 2026 at 7,000—a mere 2% gain.

Here’s how a few of the major banks are looking at 2026, from bearish to bullish, along with some select commentary from analysts:

• Bank of America has an S&P 500 price target of 7,100 for year-end 2026, up 3.52% from current levels. “On AI, in our view, investors should get ready for an air pocket,” strategists wrote. “Monetization is to be determined, and power is the bottle neck and will take a while to build out. So for now, investors are buying the dream.”
• JPMorgan’s end-of-year price target is 7,500, up roughly 9.36%. “In 2026, style positioning will likely resemble 2025, with new extremes in crowding, record concentration and a “winner-takes-all” dynamic. Looking at the S&P 500, JP Morgan Global Research estimates the AI supercycle driving above-trend earnings growth of 13% to 15% for at least the next two years.”
• UBS’s price target for 2026 is 7,700, a 12.27% gain. “Bottom-up earnings estimates have continued to be revised higher, and we expect robust profit growth to remain a key driver of equity performance into the year ahead,” analysts wrote.
• Morgan Stanley’s price target is 7,800, up 13.74%. “US earnings and cash flow growth are poised to benefit from several factors, including a market-friendly policy mix, interest-rate cuts by the Federal Reserve, a reduction of $129 billion in corporate tax bills through 2026 and 2027 from the One Big Beautiful Act, positive operating leverage, the re-emergence of pricing power and AI-driven efficiency gains.”

It’s nice to have a roadmap like this, but if there’s one thing we learned from the rise of Labubu and Katy Perry going to space last year, it’s to always expect the unexpected.—LB