S&P 500 Primed To Surge Higher Amid Prospects of a ‘Pretty Good’ 2026, Says Morgan Stanley’s Chief US Equities Strategist – Here’s the Target

Morgan Stanley chief investment officer Mike Wilson says that US stocks are likely to keep climbing this year as the 2026 outlook for earnings improves.

In a new interview on CNBC’s Squawk Box, Wilson says that the S&P 500 may gain more than 860 points from its current level after Trump’s trade policies have become clearer.

“7,200 has been our bull case [for the S&P 500]. And what we said recently is that we’re leaning more towards that case, because that’s an earnings story. And that was our call six months ago. As we laid this out, we said, look, the first half is going to be tough. They’re going to kitchen sink it. We’re going to do all the negative growth stuff, and then they’re going to flip the switch. They just did that faster and more violently than we expected. So now that second half story is playing out even quicker, but it gives us more confidence that the earnings story looks pretty good in 2026.”

Wilson also says that the markets have largely assumed President Trump’s tariff-driven impacts, but stocks may have a cooling-off period this year before resuming their climb.

“Does that mean that tariffs are not going to affect trade, they’re not going to affect GDP growth and things like that? Of course it is. But the market has already discounted all that in the first quarter for the most part. Now we discounted a lot of recovery. The bigger risk now is that the stock market is once again trading ahead of the average person and they’ve figured this out. So could we have a pause in here of some kind in the third quarter? Sure.”

As of Thursday’s close, the S&P 500 is trading at 6,339 points.

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