So here we are, three years deep into this bull market that started back in late 2022, and everyone’s asking the same question: “Is this thing ever gonna stop?” Well, grab your coffee because we need to talk about what Wall Street’s crystal ball gazers are saying about 2026.
First, the good news: the S&P 500 just crushed it again in 2025 with an 18% gain, hitting an all-time high around 6,932. The Nasdaq? Even better at 22.3%. Even the old-school Dow managed a respectable 14.5%. That’s three straight years of double-digit returns, which is basically the financial equivalent of winning the lottery three times in a row.
But here’s where it gets interesting (and slightly terrifying): valuations are absolutely bonkers right now. The Shiller P/E ratio is sitting pretty at 40.59 – that’s “we’re in bubble territory” levels. The regular S&P 500 P/E is at 31, which is the highest since 2020 when we were all panic-buying toilet paper and Zoom stock.
Now, about those 2026 predictions – because apparently, Wall Street loves making forecasts they’ll probably be wrong about:
The Optimists: Oppenheimer is basically doing cartwheels, predicting the S&P 500 will hit 8,100 (that’s a 17% gain, folks). They’re betting on corporate earnings continuing to beat expectations like they’re playing on easy mode.
The Middle Ground: Morgan Stanley is aiming for 7,800 (12.5% gain), while JP Morgan is playing it safer at 7,500 (8% gain). JP Morgan’s basically saying, “Yeah, valuations are rich, but profits are still growing, so… ¯\_(ツ)_/¯”
The Party Poopers: Bank of America is the friend who reminds you to drink water at the party. They’re predicting just 7,100 – a measly 2.6% gain. Their head strategist is watching for signs we might shift from a “buy everything” market to one focused on actual business investment.
Here’s the thing about AI stocks (because we can’t talk markets without mentioning them): Nvidia bounced back 40% in 2025 after getting absolutely wrecked in the first four months. The Nasdaq 100’s P/E dropped from 38 to 34, which is progress, but it’s still historically expensive.
So what’s the takeaway? This bull market has been running longer than most people expected, valuations are stretched thinner than your budget after the holidays, but corporate earnings are still growing. It’s like that friend who keeps saying they’re “definitely going home after this drink” – you never know when they’ll actually call it quits.
The smart money seems to think we’ve got at least another year of gains ahead, but maybe temper those expectations a bit. After all, trees don’t grow to the sky, and neither do stock prices. Usually.