Barclays lifted its year-end 2026 target for the S&P 500 to 7,650 from 7,400, saying stronger corporate profits, especially in technology, may help offset risks from the Middle East conflict, higher oil prices, inflation and tension in private credit markets.
The new call implies about 16% upside from Monday’s close of 6,581.00. Strategists said the U.S. still offers stronger nominal growth and expect a bumpy path ahead, according to a Tuesday research note.
The bank also raised its 2026 earnings-per-share estimate for the index to $321 from $305. It said the change reflects a profit base rather than a richer valuation, while warning that sustained oil strength could push inflation higher and leave the Federal Reserve with fewer options on rates.
Barclays put a bear-case S&P 500 view at 5,900 and said rising redemption pressure in private credit funds could deepen any selloff if sentiment weakens.
It also turned more constructive on U.S. industrials and nudged materials and energy higher, citing better industrial activity, AI spending and support from higher energy prices.