Up 26% year-to-date, the S&P has surpassed 2023’s 23% gain. This would be the first time the index rose at least 20% in consecutive years since 1995 to 1998 during the internet boom. The S&P’s 56.8% gain dating back to the end of 2022 has it on pace for its best two-year gain since the late 1990s.

Top strategists largely expect another year of strong returns for the U.S.’ leading S&P 500 stock index in 2025, according to early prognostications from major banks, a welcome bullish signal for investors already enjoying a historic bull market.

Deutsche Bank Sees the S&P 500 Hitting 7,000 in 2025

The bull market is poised to extend through 2025, boosted by solid demand for stocks from investors as well as strong corporate activities, such as buybacks and other spending, according to Deutsche Bank, which is calling for the S&P 500 to rise as high as 7,000.

Binky Chadha, chief global strategist at Deutsche Bank, set a year-end 2025 target for the S&P 500 of 7,000, which would translate into a 16.2% gain from current levels.

“We see robust equity (and bond) inflows continuing, boosted by strong risk appetite,” Chadha said in a note to clients. “We see S&P 500 buybacks rising from an annual run rate of $1.1 trillion currently to about $1.3 trillion next year, rising in line with earnings. We see the demand-supply backdrop for U.S. equities remaining solid even with conservative assumptions, pushing the S&P 500 to around 7000 next year.”

Yardeni Research Liftes S&P 500 Target to 7,000 for 2025

Donald Trump’s White House administration may fuel the S&P 500 index’s rally to 7,000 by the end of  next year, as the apparently jubilant U.S. stock market runs the risk of a melt up, according to Yardeni Research.

“We expect to see animal spirits in measures of consumer and business optimism in coming months as occurred when Trump was elected in 2016,”  said Yardeni, in a Nov. 10 note. But the firm also cautioned that irrational exuberance might cause a “meltup” in stocks that could “set the stage for a meltdown.” 

The stock market seemed “thrilled” about the uncontested presidential election and Tump’s win, anticipating his administration will be more “pro-business” in promoting tax cuts and deregulation, said Yardeni. Corporate tax cuts may make companies more profitable, with the firm lifting its earnings per share estimate for the S&P 500 next year and in 2026.

BMO Sets Next Year’s S&P 500 Target at 6,700

Stocks still have significant gains in front of them heading into 2025, at least according to BMO Capital Markets.

BMO chief investment strategist Brian Belski forecasts the S&P 500 will reach 6,700 by the end of next year, which would equal roughly 11.3% appreciation from current levels, matching the market’s average return since the end of the Global Financial Crisis in 2009. In a 37-page report, Belski bases his bullish call on expectations that corporate profits for the S&P 500 will equal some $275 per share in 2025, up from maybe $245 to $250 this year.

“While our work is routinely labeled as being ‘permabullish,’ we will gladly accept that moniker,” Belski wrote. “After all, U.S. stocks have averaged an annual return of 14% since 2009.”

RBC Sees the S&P 500 Rising to 6,600 in 2025

The S&P 500′s rise to fresh heights in the new year will not be in a straight line, according to RBC Capital Markets.

Strategist Lori Calvasina issued a year-end 2025 target for the broad market index of 6,600. That implies upside of 9.6% from Tuesday’s close.

Calvasina’s forecast comes as stocks enjoy a strong postelection bounce. The S&P 500 has rallied 4.1% since Donald Trump secured a second presidential term, raising expectations of lower taxes and deregulation. The benchmark has also reached record levels, breaking above 6,000 for the first time earlier this month.

Wells Fargo Expects the S&P 500 Will Advance to 6,600 by the End of 2025

Stocks are primed for another big stock market gain in 2025 given U.S. economic strength and likely deregulation under President-elect Donald Trump, according to Wells Fargo.

“Our forecast for stronger economic growth, along with policies aimed at reducing regulatory costs, should help boost S&P 500 Index EPS to $275, above our prior forecast of $270, and our S&P 500 Index price target midpoint from 6300 to 6600,” read a note from Darrell Cronk at the Wells Fargo Investment Institute.

“Earnings growth should find extra support from reduced regulation,” it continued. “A corporate tax cut remains a possibility, although the timing and amount remain uncertain.”

Barclays Lifts Price Target on S&P 500 to 6,600

Barclays Equity strategist Venu Krishna lifted the firm’s price target on the S&P 500 to 6,600 from 6,500, citing expectations for U.S. technology “exceptionalism” and a “virtuous cycle between income and consumption.”

“Macro slowing to still-healthy levels should support more US equity upside next year, albeit a deceleration from ’23-’24’s breakneck pace,” he wrote. “Positioning looks constructive, and policy uncertainty creates room for stock and sector selection.”

Krishna said there is much to be optimistic about regarding the health of the U.S. consumer, despite some risks of sticky inflation and “overblown” fears around households in financial distress. While spending growth is slowing, delinquency rates are low and savings appear to be “solid.”

UBS Sees the S&P 500 Rising Again Next Year — Maybe to 6,600

This booming period marked by strong economic growth and robust market returns could extend into 2025, according to UBS.

The Wall Street bank set its base case of a 6,600 S&P 500 target for 2025. For its bull case, the equity benchmark could climb to 7,000 by year end 2025.

Still, there are a few risks that could derail UBS’ bullish thesis, including aggressive trade tariffs, wider deficits between government spending and revenue, and geopolitical strife, all of which could drive up inflation and raise market volatility, the strategist said.

Morgan Stanley Sees S&P 500 Climbing Another 8% — to 6,500 — Next Year

The new year is setting up to be a strong one thanks to lower Federal Reserve rates and a more business-friendly presidency in Washington, according to Morgan Stanley.

Strategist Michael Wilson sees the S&P 500 reaching 6,500 in 2025. That implies upside of 7.9% from Tuesday’s close. “The combination of the Fed rate cutting cycle with the election result has the potential to drive broad sentiment materially higher,” Wilson wrote.

Wilson said the election results could lead to a “rise in corporate animal spirits” that may “catalyze a more balanced earnings profile across the market in 2025,” while an easier regulatory regime under President-elect Donald Trump boosts investor sentiment.

Goldman Expects the S&P 500 Will Advance to 6,500

The S&P 500 Index of US stocks is forecast to have its third-straight year of gains amid solid economic expansion and steady earnings growth, according to Goldman Sachs Research.

The benchmark index of US equities is projected to rise to 6,500 by the end of 2025, a 8% price gain from its current level and a 10% total return including dividends, David Kostin, chief US equity strategist at Goldman Sachs, writes in the team’s report. Earnings are predicted to increase 11% in 2025 and 7% in 2026.

In terms of the impact of policies from President elect Donald Trump, Goldman sees a lower tax rate canceling out the negative drag from potential tariffs.