Wall Street bulls up for the second half of 2025
Why it matters: Strategists are looking past the geopolitical risks and focusing on what really drives stocks: earnings growth.
That view is largely expected to continue this year despite tariff-driven uncertainty.
By the numbers: Of a sampling of 14 firms offering price targets on the S&P 500, only five forecast a year-end level below 6,000.
Based on current levels, that means most strategists see stocks rising for the rest of 2025.
What they're saying: The latest moves in the S&P 500, and tech stocks in particular, are a signal that "everything that happened as a result of tariffs and Liberation Day has kind of been brushed to the side," according to Jay Woods, chief global strategist with Freedom Capital Markets.
Zoom in: Three big themes are driving the bulls.
Belief in solid earnings growth, which Morgan Stanley expects to remain in the high single digits, and which Bank of America views as driven by consumer resilience.
Conviction in the artificial intelligence trade, validated this week by Nvidia closing at a new record yesterday.
For better or worse, the "TACO" trade remains, and market participants are largely convinced that tariff deals are coming.
Yes, but: Three big risks remain for investors.
Market breadth is still an issue, JPMorgan expects narrow leadership that mirrors the big tech rallies of 2023 and 2024. Can rising tech stocks lift all market boats forever?
The U.S. dollar is down nearly 10% so far this year, a potential signal that global investors are pulling back from American assets.
The 90-day tariff pause deadline is just two weeks away, and there are hardly any deals.
What we're watching: Not all investors are ready to move past the tariff-driven uncertainty in the economy.
Jay Pelosky, founder of TPW Advisory, is overweight non-U.S. equities and sees more upside in regions expecting stimulus-driven growth like Europe.
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