Name: Yardeni Raises S&P 500 Target on 'Fabulous Earnings Momentum'
Uploaded: 2026-08-12T18:18:24+00:00
Duration: 442 s

Speakers

Ed Yardeni — President, Yardeni Research

Summary

Ed Yardeni discusses his raised S&P 500 target, attributing the rally to strong earnings momentum rather than FOMO. He highlights broadening participation across equal-weight stocks and sectors like financials, industrials, and health care, while also seeing a global bull market and buying opportunities in geopolitical dips. He expects markets to price a September Fed rate hike but believes bonds and stocks could react positively.

Yardeni sees fabulous earnings momentum and a market melt-up, with his S&P 500 target raised.
P/E has remained around 20 while earnings have been strong; AI companies continue delivering upside.
Equal-weighted S&P 500 is up 15%, showing broadening beyond the Magnificent Seven.
Financials, industrials, and health care are at record highs with AI and productivity tailwinds.
Markets anticipate a September Fed rate hike, but Yardeni thinks bonds and stocks could respond positively.
Rates at 4-5% are seen as normal; investment-grade issuance is record and well absorbed.
He sees better valuations outside the US and describes a global bull market in stocks.
Geopolitical crises historically are buying opportunities; the market bottomed on March 30.

Ideas

Ed Yardeni President, Yardeni Research 0:00

Earnings momentum justifies higher S&P target.

Yardeni raises his S&P 500 target because the market's euphoria is driven by fabulous earnings momentum rather than FOMO; the P/E has stayed around 20 while earnings have been phenomenal, and AI companies continue to deliver upside surprises.

Ed Yardeni President, Yardeni Research 0:41

Market broadening beyond Magnificent Seven.

The equal-weighted S&P 500 is up 15% and the impressive 493 outside the Magnificent Seven are doing well, showing the rally is broadening beyond mega-cap tech; investors are buying indexes and technology, but financials, industrials, and health care are also at record highs.

Ed Yardeni President, Yardeni Research 2:15

Rate hike could boost bonds.

Yardeni expects markets to price a September Fed rate hike after a hawkish new Fed chair, but he thinks the bond market would react positively to that hike, which would also be positive for stocks.

Ed Yardeni President, Yardeni Research 3:50

Investment-grade issuance absorbed well.

Yardeni argues that 4-5% rates are normal and a vote of confidence, not a higher-for-longer problem, and notes record investment-grade bond market issuance is being absorbed very well, signaling healthy credit demand.

Ed Yardeni President, Yardeni Research 3:59

Better valuations support global equities.

After years of recommending a US overweight, Yardeni says he cannot recommend overweighting the US when it accounts for 65% of MSCI global market cap; he sees good returns and better valuations outside the US and calls this a global bull market in stocks.

Ed Yardeni President, Yardeni Research 6:06

Health care overweight on AI leverage.

Yardeni's firm raised health care to overweight because health care is the sector that most badly needs to manage information better with AI; the sector is at record highs as investors understand its businesses and AI leverage.

Ed Yardeni President, Yardeni Research 6:19

Financials gain from fintech productivity.

Yardeni favors financials, which are at record highs and spending billions on fintech; he sees significant productivity gains as financial services modernize payments and operations.

Ed Yardeni President, Yardeni Research 6:34

Industrials benefit from AI boom.

Industrials are at record highs and are directly benefiting from the ongoing AI boom, which Yardeni says is real and is driving demand across the sector.

Yardeni Raises S&P 500 Target on 'Fabulous Earnings Momentum'

Summary

Ideas

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