JPMorgan has raised its view on the S&P 500, tying the call to what it describes as an AI-driven corporate earnings supercycle. The bank expects earnings growth of more than 20% in 2026 and says the gains are no longer concentrated in large technology names alone. Utilities, healthcare, and logistics are now part of the story as well.
S&P 500 target raised to 7,600 as earnings estimates move higher
Nataliia Lipikhina, head of EMEA equity strategy at JPMorgan Private Bank, said in a July 3 interview with foreign media that the firm had lifted its S&P 500 target and expects corporate earnings growth to reach 20% in 2026. Earlier this year, the team led by Dubravko Lakos-Bujas had already increased its end-2026 target for the index from 7,200 to 7,600.
The earnings revision was just as notable. JPMorgan now forecasts 2026 earnings per share of $330, up 22% year over year, with 2027 EPS seen at $385. On valuation, the bank kept its forward price-to-earnings multiple at about 22x. That framing matters. It suggests JPMorgan sees the rally as being driven by profit growth rather than by a market multiple expanding on its own.
AI tailwinds are spreading beyond the largest tech companies
The bank’s argument rests on AI spending turning into measurable productivity gains. In its view, that process is already moving beyond the major technology firms and into more traditional sectors. Utilities, healthcare, and logistics were all cited as areas benefiting from the shift. That helps explain why Wall Street has kept its focus on earnings even as markets dealt with macro noise such as earlier geopolitical tensions involving Iran.
By holding the forward P/E assumption steady, JPMorgan is effectively saying the next leg higher in equities needs to come from stronger profits. The thesis is not based on investors paying ever-higher multiples, but on companies delivering the earnings growth now being projected.
Index already near the bank’s target, with 9,000 as a bullish case
As of the June 2 close, the S&P 500 was trading near 7,610, effectively reaching JPMorgan’s 7,600 target for the end of 2026 ahead of schedule. That has shifted attention to how much room may still remain if earnings continue to come through.
JPMorgan Private Bank said the index could challenge 9,000 by mid-2027 if the AI supercycle proves stronger than expected. The bank did not present that as its base case. It described it as a plausible upside scenario, with the same foundation underneath: sustained corporate earnings growth rather than a fresh burst of valuation expansion.