Stock market rally is built on narrative that is loaded with risk

Bullish sentiment towards stocks is rampant in the US, as one Wall Street strategist after another raises their target for an S&P 500 Index that is repeatedly setting records.

“All new highs are positive, except for the final one,” Sam Stovall, chief investment strategist at CFRA, said by phone. He does expect the rally to continue, partly because US stocks

are hitting records at the same time as other developed equity markets, which has been a strong signal historically.

Many on Wall Street are treating these concerns like the risk factors in the prospectuses of the many IPOs hitting the market these days – they’re real and strategists and investors are aware of them, but they aren’t being scared away.

Strategists at Deutsche Bank

, Barclays, Wells Fargo, US Bank and Yardeni Research all raised their price targets on the S&P 500 in the past week. Looking further out, Goldman Sachs

and Morgan Stanley also published bullish outlooks for 2026 on expectations that Federal Reserve

rate cuts expected to begin on September 17 could spur a further rally.