Bank of America predicts: the strong rally of the S&P 500 Index will fade in 2026

Jinse Finance reported that Bank of America believes that after three consecutive years of double-digit returns, there is limited room for excess gains in the U.S. stock market in 2026. The bank predicts that the S&P 500 Index is likely to close at around 7,100 points in December next year, which is only about 4% higher than the closing price on Tuesday (December 2). Although U.S. companies are expected to achieve double-digit earnings growth, stock price returns will tend to be flat. Savita Subramanian, head of equity and quantitative strategy, believes there are risks, but does not anticipate a crash; compared to 2000, current investor equity allocations are lower, earnings growth supports returns, and enthusiasm for speculative stocks is not as extreme.