UBS raises S&P 500 index’s annual target on fading trade tensions

(Reuters) -UBS World Wealth Administration raised its year-end goal for the S&P 500 index to six,200 from its prior forecast of 6,000, banking on softening commerce tensions and expectations of resilient quarterly earnings.

UBS’s present goal implies a few 1% upside to the benchmark index’s final shut of 6,141.02. Main brokerages Citigroup and Barclays additionally lifted their targets for the index earlier this month.

U.S. equities have been on a restoration rally as easing commerce tensions boosted investor danger urge for food, following a tariff-led sell-off spree in March and April.

“We expect the restoration is sensible, contemplating that almost all large-cap firms ought to climate the tariffs fairly effectively,” UBS stated in a observe late Thursday.

The wealth administration unit of European financial institution UBS has maintained its ‘impartial’ stance on U.S. equities.

President Donald Trump’s administration in April imposed reciprocal tariffs on key buying and selling companions, which rattled world monetary markets, however has since then diminished among the tariff charges on sure nations, together with China.

“The excellent news is that progress and inflation ought to begin to enhance later this yr as soon as the economic system adjusts to the one-time influence of the tariffs,” stated UBS.

UBS additionally raised the index’s annual earnings-per-share (EPS) estimate to $265 from its earlier projection of $260.

“We expect one other resilient (Q2) earnings season and the finances reconciliation invoice might additionally enhance company money flows which might be used for added share repurchases or funding spending,” the wealth administration unit stated.

UBS additionally raised its 2026 mid-year index goal to six,500 from a previous view of 6,400, whereas additionally lifting the EPS forecast to $285 from $280.

(Reporting by Siddarth S and Rashika Singh in Bengaluru; Enhancing by Shreya Biswas)