Overview
- JPMorgan, which raised its year-end S&P 500 goal on Tuesday, now targets 7,600 after a ceasefire cooled Middle East risk and AI stocks pushed the index to records.
- The bank lifted its 2026 earnings-per-share view to $330 and 2027 to $385 and kept its valuation at 22 times expected earnings, signaling an earnings-led call rather than richer pricing.
- Strategists said a quick geopolitical resolution could lift the valuation to 23 times earnings, a path that would place the index near 8,000.
- JPMorgan credited Anthropic’s Claude Mythos model with reigniting the AI trade, noting that since April 7 about two thirds of S&P 500 AI-linked stocks beat the market, even though Mythos’ wider release was paused over cybersecurity worries.
- The team warned the rally looks stretched with the 10-day relative strength index above the 95th percentile and flagged a short pullback risk while oil hovers near $90 and the ceasefire remains in flux.