Strong earnings and falling rates will lead the stock market to another fantastic year in 2026, according to Oppenheimer. The firm has set its S&P 500 (SPX) 2026 year-end price target at 8,100, the highest on Wall Street and implying upside of about 18% from current levels. Deutsche Bank previously had the highest price target at 8,000.
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“We remain positive on stocks and regard it as our favorite asset class,” said Oppenheimer chief investment strategist John Stoltzfus.
AI-Powered Efficiency Expected to Broaden 2026 Rally
Stoltzfus expects the benchmark index to post a 2026 EPS of $305 and trade at a forward price-to-earnings (P/E) ratio of 26.5x, up from the current ratio of 23.2x. The ratio could decrease if earnings top estimates, which has been a trend since 2023.
In addition, he believes that AI will help companies become more efficient and will support a broader rally across the entire stock market. Oppenheimer’s top sectors for 2026 include information technology, communications services, and industrials. Additionally, the firm points out that utilities could benefit from AI-driven electricity demand.
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