Barclays and JPMorgan expect S&P 500 to rise despite Wall Street's cautious positioning

Analysts at Barclays and JPMorgan expect US stocks to go up despite the current cautiousness of institutional investors. So far, according to Deutsche Bank AG, their overall positioning on stocks is quite low—it has been lower in only 23% cases witnessed since 2010.

Their sentiment is pressured by President Donald Trump's constantly changing trade policies, which is curbing activity even though retail investors' bullish stance keep supporting the S&P 500.

For Deutsche Bank, the cautious sentiment is part of their bullish scenario for the S&P 500. According to the bank's strategist Binky Chadha and his team, if investors become convinced that the impact of tariffs is modest, they are likely to turn overweight in anticipation of a rebound. Chadha and his colleagues expect the index to rise to 6,550 by the end of the year.

That said, Barclays strategists, as stated by their head Alexander Altmann, intend to maintain long positions in US equities in the coming weeks. In his opinion, the sentiment is now “too low.”

An important event for the market will be the release of data on the US consumer price index on Wednesday, which could shed light on the effects of tariffs on inflation.