JPMorgan’s chief equity strategist, Dubravko Lakos-Bujas, sees another strong year ahead for the US stocks despite bubble concerns and macroeconomic uncertainty.
In his latest report, Lakos-Bukas told clients that the benchmark S&P 500 index could push higher and touch the 8,000 level by the end of 2026. This suggests potential for another 18% upside from here.
The strategist’s positive call is meaningful given that the S&P 500 has rallied over 35% already since early April.
What Lakos-Bukas’ forecast suggests is that 2026 could be the fourth consecutive year of double-digit gain for the benchmark index that tracks the performance of America’s top 500 publicly listed firms.
What JPM believes will drive the S&P 500 higher in 2026
Lakos-Bujas’s bullish view is rooted in one simple narrative: the market’s strength isn’t speculative, but grounded in strong fundamentals.
According to him, productivity gains tied to artificial intelligence (AI) and deregulation will drive double-digit earnings growth across sectors in 2026.
In his research note, the JPM strategist also argued that the US central bank will lower rates at least two more times next year, followed by a prolonged pause, which could ease financial conditions and sustain risk appetite.
“We see current elevated multiples correctly anticipating above‑trend earnings growth, an AI capex boom, rising shareholder payouts, and easier fiscal policy.”
Lakos-Bujas dubbed the earnings boost from broadening AI adoption as “underappreciated” in his report – signalling room for further upside in US stock over the next 12 months.
What JPMorgan recommends buying heading into 2026
To capitalize on these trends, JPMorgan has compiled a basket of companies it believes will benefit most from AI and data center expansion.
The list includes Amazon.com Inc (NASDAQ: AMZN), Nvidia Corp (NASDAQ: NVDA), and Alphabet Inc (NASDAQ: GOOGL) – each positioned to ride the next wave of tech investment.
Lakos-Bujas acknowledged the lag in AMZN shares this year, but said its cloud and retail business remain central to artificial intelligence infrastructure.
Meanwhile, Nvidia – despite a significant pullback in November amid a broader tech rout – retains its dominance in AI chips.
And Google stock, the JPMorgan expert argued, will extend its more than 100% rally over the past seven months as investors continue to reward its aggressive push into AI-driven services.
Just last week, the multinational launched “Gemini 3,” and there have also been reports that Meta is considering switching to its tensor processing units (TPUs) to power its data centres by 2027.
In short, for investors, the strategist’s message is clear: while valuations remain elevated, structural drivers of growth – from technology spending to shareholder returns – could keep the bull market alive.
As is evident, while the AI bubble may be real, Lakos-Bujas isn’t entirely convinced that it is about to pop anytime soon.
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