UBS sees S&P 500 climbing to 7,500 in 2026 as earnings power growth
UBS expects the S&P 500 to rise to 7,500 by 2026, driven primarily by around 14% earnings growth, with nearly half of that contribution coming from the technology sector. The bank said valuation multiples are unlikely to expand further, making profits the key driver of returns.
In a research note published Monday, UBS described a “tale of two halves” for the global economy:
- a short-term soft patch giving way to stronger momentum later in 2026 as confidence improves and fiscal support takes hold.
- The bank highlighted that tariffs are still filtering through to prices and exports, keeping near-term conditions choppy.
UBS projects roughly 10% returns for U.S. equities next year, outpacing other major markets.
- While Europe and emerging economies are also expected to deliver “decent earnings” and about 8% returns, the bank believes they will “mildly underperform” the U.S. benchmark.
The analysts said valuation effects will likely be a “small negative,” but added that persistent inflows could still push multiples higher. UBS also expects the rally to broaden beyond large-cap tech in the second quarter of 2026, extending into lower-quality cyclicals after a period of consolidation earlier in the year.
