Buy SPX up to $7,800

The S&P 500 Index is confidently climbing, driven primarily by the success of the tech sector. Massive corporate investments in artificial intelligence (AI) and robust US macroeconomic performance play a major role in SPX’s upside. Typical headwinds, such as the Federal Reserve’s (Fed) hawkish posture and the risk of local corrections, are unlikely to stand in the asset’s way. The consensus forecast among the largest banks remains moderately optimistic.

What is happening in the American stock market right now? Tech giants continue to relentlessly increase their capital expenditures (CapEx). Total investment in AI infrastructure is expected to reach approximately $800 billion, which should convert directly into corporate revenues. Earnings per share (EPS) of S&P 500 companies have recently been rising at a double-digit pace, making the tech sector a primary engine behind the current rally. Of course, the Fed’s decision to keep interest rates elevated should be taken into account. However, US GDP growth remains surprisingly resilient. The robust labor market supports consumer activity, pushing recession risks aside.

But why should you be worried? Several headwinds stand out:

Limited growth potential. Market capitalization is concentrated in a handful of tech giants, which may cap the current upside.

Persistent inflation threat. Consumer prices could surge again and destabilize the index’s rally. 

Elevated Treasury yields. Returns on 10-year notes stay high, creating competition for the US stock market.

So, what to expect further? Let’s turn to the scenarios priced in by major global investment banks:

Morgan Stanley experts anticipate SPX to hit $8,000 by the end of 2026. In 2027, the index may climb to $8,300. 

Goldman Sachs shares these projections, expecting $8,000 by December. For the next year, analysts urge attention to the fundamental picture, predicting an increase in net EPS to $385.

Barclays has recently revised its forecasts upward, with a long-term target of $8,800 by 2027.

Jefferies holds the most positive expectations, looking for an impressive surge to $9,000 next year. As for 2026, the bank tells a similar story, awaiting SPX to rise to $8,000. 

The medium-term trend for the S&P 500 remains bullish. The current forward P/E valuation aligns with historical averages seen during tech cycles. The baseline scenario suggests that solid corporate earnings and a gradual broadening of market participation—with gains extending beyond the IT sector into financials, industrials, and energy—will enable the index to settle above the psychologically important zone between $7,800 and $8,000.

The overall recommendation is to buy SPX. Profits should be taken at $7,800. Stop Loss could be set at $7,600.

Always size the position so that your potential loss (protected by a Stop Loss order) is no more than 1% of your account balance. If you cannot open a position that meets such a risk criterion, it is safer to skip this trade and wait for a better, lower-risk opportunity.