JPMorgan Strategists Raise S&P 500 Target as AI Capex Pays Off

JPMorgan Strategists Raise S&P 500 Target as AI Capex Pays Off

Levin Stamm
Mon, August 10, 2026 at 2:58 PM GMT+5:30
2 min read

(Bloomberg) — JPMorgan Chase & Co. strategists raised their S&P 500 Index forecast for a second time in two months, citing strong corporate earnings and the payoff from massive artificial intelligence spending

• Iran Shakes Up Security Team After Saying Oman Deal ‘Very Close’

• China Unleashes $28 Trillion Capital Markets to Challenge US in AI

• Stocks Hold Near Record Highs, Oil Ticks Higher: Markets Wrap

• Trump Amps Up Pressure on Billionaire Sargeant to Exit Venezuela

• Iran Says Hormuz Deal Close But Its Conditions Must Be Met

The team led by Dubravko Lakos-Bujas now sees the US benchmark rising to 8,000 points, implying gains of about 3% from Friday’s close. They had bumped their target to 7,800 from 7,600 in June. The latest forecast is slightly above the average of 20 strategists polled by Bloomberg

The second-quarter earnings season has produced evidence that capital expenditure by the so-called AI hyperscalers is being monetized through customer demand, the JPMorgan team said. They cited stronger cloud growth and increased backlogs at Alphabet Inc., Amazon.com Inc. and Microsoft Corp. that should reduce worries over return on their invested capital

“As elevated backlogs convert into recognized revenue, cloud growth should remain well supported, helping validate rising AI capex,” they said. “Across hyperscalers, demand indicators remain high and rising.”

The S&P 500 has reclaimed record highs as corporate earnings surged 32% in one of the best increases on record. There’s been intense focus on Big Tech’s spending on AI and the impact that’s having on their cash flow

The JPMorgan strategists expect AI spending to keep climbing, with the technology projected to account for well over half of total capex of $1.5 trillion across the S&P 500 this year, a proportion that’s tipped to grow

Strategists at banks including Citigroup Inc., Deutsche Bank AG and Goldman Sachs Group Inc. are also among the most bullish voices on US stocks this year. On average, the S&P 500 is seen rising to 7,845 points by the year end, about 1% above current levels

–With assistance from Sagarika Jaisinghani

Most Read from Bloomberg Businessweek

• Lululemon Is At War With Itself

• How Apple and India Built an Alternative iPhone Production Hub

• The $5 Billion Cosmetics Company Behind the High-Flying Rhode Brand

• RFK Jr.’s Cooking Show Is One Long, Boring Political Ad

• TikTok Withheld a Safety Feature From Millions. One Died by Suicide

©2026 Bloomberg L.P.