Wall Street's biggest bull stands pat on S&P 7,000 call

Wall Street stock market strategists have largely abandoned the lofty expectations they took into 2025, but one bull isn’t budging: Wells Fargo Securities LLC’s Christopher Harvey. 

He projects that the S&P 500 Index will end the year at 7,007, the same number he had at the start of 2025. It’s currently at 5,672, and that’s after the index climbed more than 10% in the previous nine sessions, its longest winning streak in over two decades. Harvey’s estimate assumes the US equity benchmark will rise another 24% over the next eight months. 

Obviously, the potential impact of President Donald Trump’s trade war on the economy looms over all of this, as do the promises of tax cuts and the possibility of rate cuts by the Federal Reserve. But Harvey sees a change of tone coming from the White House.

“If we go from stick to carrot, it’s a lot different market,” he said Monday in an interview with Bloomberg Surveillance. “I think we’re past peak uncertainty.”

Harvey is pretty far out on a limb compared to even his most bullish colleagues. The average price target for the S&P 500 this year among the 29 strategists tracked by Bloomberg is 5,853. After Harvey, the next-highest predictions are Scotiabank’s Hugo Ste-Marie at 6,650 and Fundstrat’s Tom Lee at 6,600.

Across Wall Street, strategists have been slashing their outlooks for the index at a faster pace than at the onset of the pandemic in 2020, according to a Bloomberg survey. Deutsche Bank’s Bankim Chadha is the latest to lower his S&P 500 target, cutting it to 6,150 last month from 7,000 previously. Other well-known optimists like BMO Capital Markets’ Brian Belski, Oppenheimer Asset Management’s John Stoltzfus, and Ed Yardeni of Yardeni Research tempered their predictions during April’s turbulence.

Going into the year, Harvey predicted that a favorable macroeconomic backdrop and easing monetary policy will keep US equities soaring after back-to-back years of 20% gains in 2023 and 2024. He’s sticking to that.

“If you look at the second half of the year, do you believe the Fed is going to be cutting rates? We do,” Harvey said on Bloomberg Television. “What we’re doing is we’re repricing risk, we’re repricing expectations, you can pull out of that. So the economy can improve.”

He has a point in that although the central bank isn’t expected to move at its meeting this week, Fed officials have been talking about a possible rate cut in June.

Some of Harvey’s historically bullish colleagues are sounding remorseful about adjusting their calls after the rally over the last two weeks. For example, Yardeni was among the first to throw out his S&P 500 target for this year, but on Sunday he floated the idea of lifting it back up as his firm lowered the odds of a recession.

“We are inclined to do so given the power of the V-shaped rally in the S&P 500,” he wrote in a note to clients. “However, we aren’t ready to do so given the following two issues: earnings and valuations.”