Stock Market 2025: JPMorgan Predicts Bullish Outlook with 8% Increase for S&P 500

JPMorgan’s outlook on the S&P 500 has taken a bullish turn, as the bank now predicts a significant rise in the stock market. This change in perspective comes after holding a bearish position with a lower target for the previous year.

In a recent note, JPMorgan highlighted several factors that contribute to its positive outlook for the upcoming year. These factors include US exceptionalism, the growth of artificial intelligence, and the monetary easing policies adopted by central banks. This shift marks a significant change for JPMorgan, as the bank was previously one of the remaining bears on Wall Street.

The bank has raised its 2025 target for the S&P 500 to 6,500, indicating a potential 8% increase. This adjustment represents a 55% increase from its previous 2024 year-end target of 4,200. JPMorgan strategist Dubravko Lakos-Bujas emphasized the expanding business cycle, US exceptionalism, and the growth of earnings as key drivers behind the bullish outlook.

This shift to a bullish stance marks a departure from the bank’s previous bearish position led by former strategist Marko Kolanovic. Despite being bullish during the 2022 bear market, Kolanovic’s view turned bearish just as the bull market began in October 2022. This sentiment persisted even as the S&P 500 surged in 2023, until Kolanovic left the bank in the summer.

Lakos-Bujas pointed to the strength of the consumer as a significant factor in the bank’s positive view of the stock market. He highlighted the tight labor market, record household wealth of $165 trillion, and the potential benefit of lower energy prices in the future. Additionally, the recent US presidential election results could also contribute to a boost in the stock market and the economy.