Worried about S&P 500, will go up in 2026 but not by much, says Robinhood's Stephanie Guild

Market Overview - The markets are experiencing record highs, with the Dow, S&P 500, and Russell 2000 reaching all-time closes, and the Dow Transports hitting a 52-week high [1] - There is a concern regarding the S&P 500's future performance, with expectations of limited growth into 2026 [2] Investment Strategies - The focus is shifting towards smaller stocks rather than the largest names, indicating a potential rotation in investment strategies [2] - Since October 29th, 41 of the top 100 performing stocks have shown negative returns, suggesting a lack of recovery in these stocks since the recent pullback [3] Sector Focus - There is an increasing interest in regional banks and consumer names as part of the new investment strategy [3] - The market is currently influenced by two main factors: the Federal Reserve's actions and developments in artificial intelligence [4] Federal Reserve Influence - The Federal Reserve is expected to cut rates again in January, with a target rate of 3.5%, which is anticipated to positively impact consumers [5] - The Fed's current strategy includes purchasing short-term treasuries, which may also support market stability [6] Economic Outlook - The upcoming midterm elections are expected to shift fiscal policy focus towards the everyday consumer, potentially improving consumer sentiment and benefiting retailers [6]