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LivestreamMenuRBC Capital Markets sees more room for the stock market to rise, but warned that it may not be a smooth ride. Lori Calvasina, the firm’s head of U.S. equity strategy, lifted her price target for the S & P 500 in 12 months by 250 points to 8,150. Calvasina’s refreshed target suggests 10.8% upside from where the broad index finished last week. “We continue to think of our forecast as higher but not heroic, and reflective of the idea that stocks can move higher in the year ahead even though the path is unlikely to be a linear one,” Calvasina wrote in a Monday note to clients. .SPX YTD mountain The S & P 500 in 2026 Calvasina said the hike was driven in part by the “stronger signal” seen when looking at earnings per share and valuation expectations. The strategist said she assumes a trailing four-quarter earnings per share of $337 in the first quarter of next year. To be sure, the strategist said she still has some conservatism in her model and warned that there could be volatility for stocks on the path higher. Calvasina said that there were concerns in particular about the Federal Reserve potentially hiking interest rates. Fed funds futures are pricing in a 64% likelihood of the central bank raising rates at its September meeting, according to CME’s FedWatch tool. But she said her team has a “little less concern” baked in compared with a month ago and that investors can be excited by the prospect of lower oil prices and inflation. If recession concerns remain low and the Fed institutes “moderate” rate hikes, Calvasina said the market should only see “garden variety” pullbacks of between 5% and 10%. Many other Wall Street strategists set year-end S & P 500 targets as opposed to 12-month outlooks. The average strategist tracked by CNBC Pro expects the S & P 500 to finish this year at 7,807, roughly 4% off Calvasina’s prediction for one year out. The S & P 500 has risen more than 8% in 2026, on track for its fourth straight winning year.Read More
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