UBS Predicts S&P 500 Surge: Earnings Growth to Drive 14% Rise

UBS predicts a significant surge in the S&P 500 next year, anticipating an increase to 7,500 points. This growth is attributed to a projected 14% jump in earnings, with technology accounting for nearly half of this increase. The bank anticipates that the initial economic slowdown anticipated in early 2026 will be followed by stronger global growth throughout the latter part of the year. U.S. stocks are expected to achieve approximately a 10% annual return, primarily driven by corporate earnings rather than valuations expanding. This positive trend is anticipated to extend beyond technology companies and into other sectors by mid-year.