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Most Large Banks and Many
Insiders see a positive 2026 in the Markets!
Here are the
2026 stock market predictions from all of Wall Street's top banks
By Jennifer SorFollow
TIMOTHY A. CLARY / AFP via Getty Images
Dec 8,
2025, 5:15 AM ET
·
W Wall Street's top banks are lining
up to deliver their year-ahead outlooks.
· Bullish forecasts cite robust
earnings growth, AI-driven gains, and potential Fed rate cuts
· Banks expect continued US economic
growth and expanding AI investments.
The
bull market turned three this year, and Wall Street thinks you should be
gearing up to celebrate another big run in 2026.
Analysts
at top banks have rolled out their predictions for where they think the market is
headed in the coming year. Their forecasts are looking strong across the board,
with most expecting US stocks to punch higher as the Fed cuts interest rates, earnings grow, and the US economy continues to chug along.
Despite
some recent volatility in the tech sector, stocks are still firmly in bull
market territory after back-to-back years of double-digit gains. The S&P 500 is up 17% year-to-date, and has
gained 79% since the end of 2022.
Those
returns have largely been fueled by the hype for artificial intelligence — a
frenzy that's sparked concerns of a stock market bubble and has shown more cracks
in recent weeks as investors survey high valuations and seemingly endless AI spending among top tech firms.
Even
so, the market has room to grind higher, according to the top analysts.
Here's
the rundown of forecasts and price targets from the big banks.
Bank of America
Eduardo Munoz Alvarez/VIEWpress
S&P 500 price
target for 2026: 7,100
Upside from current
levels: +3%
Core thesis: BofA's prediction is on the lower end,
but it still expects S&P 500 earnings to grow 14% for the year. That should
help power the market higher, but gains could be held back by factors like
fewer stock
buybacks, fewer Fed
rate cuts than
expected, and the possibility that the Fed will only cut rates if the US
economy looks weak.
"In
2026, earnings will do the lift," strategists wrote in their
year-ahead outlook. "Liquidity is full blast today,
but the direction of travel is likely less not more," they added.
JPMorgan
ANGELA WEISS/AFP via Getty Images
S&P 500 price
target for 2026: 7,500
Upside from current
levels: +9%
Core
thesis: The
bank is eyeing above-trend earnings growth of 13%-15% for at least the next
several years. That should help sustain high valuations in the stock
market, alongside a boom
in AI-related capital expenditures, larger shareholder payments, and fiscal
stimulus from President Donald Trump's
Big Beautiful Bill.
HSBC
Mike Kemp/In Pictures via Getty Images
S&P 500 price
target for 2026: 7,500
Upside from current
levels: +9%
Core thesis: Global stocks will keep rallying next
year as the AI
trade expands
beyond the hyperscalers that have positioned themselves at the center of the
artificial intelligence craze. Investors can expect to see earnings growth slow
down for the Magnificent Seven, while earnings pick up in the rest of the
S&P 500.
The broadening of the rally is
generally considered a healthy trend among investors, who want to see more
breadth and less reliance on just a few stocks to drive more gains.
HSBC
thinks US economic growth will remain solid, a factor that should help cyclical
stocks outperform.
RBC
Nick Lachance/Toronto Star via Getty Images
S&P 500 price
target for 2026: 7,750
Upside from current
levels: +12%
Core thesis:
The bank said it had
determined its price target based on various models that project the S&P
500's return based
on factors like sentiment, valuations, and economic and monetary policies.
Investor
sentiment is at levels that are sending a "contrarian buy signal" for
long-term investors, the bank said. Strategists added expected solid earnings
growth and
expected rate
cuts from the Fed
to prop up the market, though subdued economic growth could be a drag on stock
returns.
Morgan Stanley
Mike Kemp/In Pictures via Getty Images
S&P 500 price
target for 2026: 7,800
Upside from current
levels: +13%
Core thesis: Stocks will get a lift next year from
strong corporate earnings and a "rolling
recovery" in the
economy that's expected to pick up steam, Morgan Stanley strategists said. The
bank referred to its previous view that the US was in the midst of a
"rolling recession," where a downturn hits the economy in various
sectors at different times.
"We
believe that we're in the midst of a new bull
market and earnings
cycle, especially for many of the lagging areas of the index," strategists
wrote.
Deutsche Bank
Thomas Lohnes/Getty Images
S&P 500 price
target for 2026: 8,000
Upside from current
levels: +16%
Core thesis: Earnings
growth is expected
to accelerate to around 14% next year, which will help drive the stock market
higher. Valuations in the S&P 500 should be supported by higher payout
ratios, fewer large earnings declines, and inflation remaining below its
long-term average.
"Our
demand-supply framework suggests mid-teens returns on the back of positioning
rising from neutral, a continued cross-asset inflows boom benefiting equities,
and buybacks rising in line with earnings," the bank wrote a client note.
(As with any of these informative articles,
anyone who needs someone to talk to about
this
very subject contact me and I can direct you to a knowledgeable advisor).
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