Headline: UBS projects S&P 500 at 7,500 by 2026 as profit growth leads the market
UBS has raised its long-term outlook for U.S. equities, calling for the S&P 500 to reach 7,500 by 2026. The bank expects profits, rather than richer valuation multiples, to do the heavy lifting, with earnings expanding by roughly 14% and the technology sector supplying close to half of that growth.
In its latest market outlook, UBS describes a short-term cooling phase for the global economy that gives way to stronger momentum into 2026 as business confidence improves and fiscal support filters through. At the same time, the bank notes that ongoing tariffs are still working through prices and trade flows, which could keep near-term conditions uneven. For the year ahead, UBS forecasts about 10% total returns for U.S. stocks, ahead of Europe and emerging markets, which it expects to deliver solid but slightly lower gains near 8%.
UBS anticipates that valuation multiples will be a modest headwind overall, though steady investor inflows could still push them higher at times. While mega-cap technology has led the cycle, the bank expects leadership to broaden in the second quarter of 2026 after a consolidation phase earlier that year, extending into more cyclical and lower-quality areas as the expansion firms up.
Key Points – UBS targets the S&P 500 at 7,500 by 2026, led by earnings rather than multiple expansion. – Profit growth is projected at about 14%, with technology contributing nearly half. – U.S. equities are expected to return roughly 10% next year, outpacing Europe and emerging markets near 8%. – Tariffs continue to influence prices and exports, keeping near-term conditions choppy. – Valuation effects may be a small negative overall, but inflows could buoy multiples. – Market leadership is expected to broaden beyond large-cap tech by Q2 2026, including more cyclical segments.
