Leading US investment bank JPMorgan Chase & Co. has officially raised its year-end target for the S&P 500 index to 7,800 points, way above its previous forecast of 7,200. The revised target implies a further 5.9% upside from the closing price on June 23. JPMorgan's Chief Market Strategist Dubravko Lakos-Bujas said that US financial markets are steadily moving toward the most favorable economic scenario, with the expected diplomatic resolution of the prolonged geopolitical tensions between Washington and Tehran, serving as the key catalyst.

However, Lakos-Bujas cautioned that the market's upward trajectory is unlikely to be smooth, as investors will have to navigate several near-term challenges. Exceptionally strong corporate earnings over the past two quarters have significantly raised expectations ahead of the upcoming season of corporate reports. According to the latest FactSet data, net earnings of S&P 500 companies increased by nearly 14% in the fourth quarter of 2025 and surged 28.9% in the first quarter of 2026. With earnings currently projected to grow by another 22% this quarter, companies may find it increasingly difficult to exceed Wall Street's elevated expectations for both financial performance and capital expenditures.

Additional headwinds for stocks in the coming months could include a growing supply of newly issued securities and the risk of tighter monetary policy from the Federal Reserve. Despite these challenges, analyst Lakos-Bujas remains confident that the long-term bull market will stay intact. In his view, continued growth in corporate investment in artificial intelligence (AI), combined with the resilience of US consumer spending, will remain powerful catalysts, supporting further gains in the stock market.