Banking giant sets new bullish S&P 500 2026 target

Core Viewpoint - Barclays has raised its 2025 year-end target for the S&P 500 to 6,450 from 6,050, marking its second upward revision in three months, driven by strong corporate earnings, resilient U.S. economic growth, and optimism around artificial intelligence [1][4]. Group 1: Target Revisions - The new target implies a 1.5% drop from the current index value of 6,547 [3]. - Barclays has also raised its 2025 S&P 500 EPS forecast to $268 from $262 and lifted its 2026 target to 7,000, projecting EPS of $295 versus $285 previously [5]. Group 2: Economic Drivers - Stronger-than-expected corporate earnings and resilient U.S. economic growth are cited as main drivers of the positive outlook [4]. - Investor optimism around artificial intelligence has contributed to the index's rebound, which rallied about 30% following robust earnings [4]. Group 3: Sector Outlook - Barclays turned "positive" on U.S. technology due to strong data center demand and easing AI concerns [6]. - The materials sector was upgraded to "neutral" based on improving metals and chemicals outlook, while healthcare was cut to "neutral" amid regulatory pressures [6]. Group 4: Broader Market Trends - Other banking institutions, such as HSBC and Citigroup, have also revised their S&P 500 targets upward, reflecting similar trends in corporate earnings and reduced tariff concerns [7][8]. - HSBC raised its year-end forecast to 6,400 from 5,600, while Citigroup lifted its target to 6,600 from 6,300 [7][8].