'Even an uber bear such as myself can see how the huge and sudden swing to equity pessimism would likely sustain a good near-term bounce'.

You know something interesting is happening in markets when the bears on Wall Street suddenly start telling their clients that stocks are looking like a buy.

The volatility that has seized the U.S. stock market showed no signs of slowing down this week - although the S&P 500 SPX did manage to eke out a gain on Friday and avoid a fifth straight week in the red.

And yet, no fewer than three high-profile bears have recently advised that the market could be overdue for a bounce, even as their views on the market over the long term haven't changed.

Stifel's Barry Bannister has one of the lowest year-end targets for the S&P 500 on Wall Street, calling for the index to finish 2025 at around 5,500. In a report shared with MarketWatch on Thursday, Bannister said he wouldn't be surprised to see a relief rally carry the S&P 500 back to around the 5,850 level by the end of the second quarter.

That doesn't mean Bannister is giving up on his target. After a handful of more-bullish strategists cut theirs over the past couple of weeks, Bannister said in his latest report that he would be standing firm.

For now, Bannister believes that falling bond yields BX:TMUBMUSD10Y have spooked stock investors. Falling yields could be a sign that bond traders are bracing for a recession. But, for now at least, Bannister doesn't see one on the horizon.

Bannister recommended that long-term investors interested in putting money to work now consider defensive names, like utilities and healthcare stocks - although he acknowledged that it is often the erstwhile market leaders the benefit the most when the market rebounds.

Coming into 2025, Peter Berezin, chief global strategist at BCA Research, expected the S&P 500 to fall to 4,450 by the end of the year - the lowest target among his peers, and even lower than Bannister's.

But in a report shared with clients on March 14, he decided to play devil's advocate and discuss what could go right for the market in 2025.

"All that said, despite our bearish predisposition towards stocks, we are open-minded to anything that could challenge our thesis," he said in the report.

Berezin outlined five scenarios that could boost stocks this year.

President Trump could walk back much of his tariff agenda, caving to pressure from the market. Bond yields remain unperturbed by plans to legislate more unfunded tax cuts. Fiscal stimulus and structural reforms - like reducing barriers to trade within the European Union - could boost Europe's economy. Increased U.S. oil production (CL00) could lead to lower prices at the pump for American consumers. And finally, the expected productivity boost delivered by artificial-intelligence technology could be even greater than expected.

Even Albert Edwards - the Societe Generale strategist who has cultivated a reputation as a permabear during his decades in the business - acknowledged the possibility of a near-term bounce.

In a post published on his LinkedIn page, Edwards shared a sentiment model from SentimenTrader that highlighted the dramatic downturn in bullish sentiment. In Edwards's view, investors' extreme pessimism has likely become overdone.

"Even an uber bear such as myself can see how the huge and sudden swing to equity pessimism would likely sustain a good near-term bounce," he said.

The notion that stocks might be due for a bounce isn't so far-fetched. The 14-day relative strength index for the S&P 500 dipped below 30 last week, according to Dow Jones Market Data.

Most technical strategists would agree that readings below 30 signal that the market has become oversold. The popular momentum gauge has recovered somewhat this week, as stocks rallied following Wednesday's Federal Reserve meeting.

Also, the SentimenTrader gauge cited by Edwards is hardly the only indicator suggesting bearish sentiment might have gotten ahead of itself.

On Thursday, a weekly survey published by the American Association of Individual Investors showed that nearly 60% of respondents expected stocks to fall over the next six months. That marked the fourth straight week with sentiment at, or around, that level.

U.S. stocks managed to eke out a gain on Friday after initially opening lower, FactSet data showed. The Nasdaq Composite COMP joined the S&P 500 in snapping a four-week losing streak.

The Dow Jones Industrial Average DJIA also finished higher after back-to-back weekly losses.