BMO Capital has raised its year-end S&P 500 target to 7,000, aligning its forecast with what it had previously described as its bull case scenario.
According to the bank’s analysts, the upgrade reflects both the strength of the current rally and the resilience of the U.S. equity market. In a client note, BMO acknowledged the skepticism such a move may draw but emphasized that stocks have continued to climb despite repeated macroeconomic concerns.
The firm reiterated its long-held belief that U.S. stocks are in the midst of a “25-year secular bull market,” a view it has maintained for more than 15 years. It credited its disciplined investment process for keeping portfolios invested through 2025, which helped deliver the strongest second-quarter performance in more than two decades of managing equities.
BMO also cautioned that markets rarely move in a straight line. Analysts said a surge to 7,000 followed by a period of consolidation would be the most likely outcome. Still, they argued that conditions remain favorable for equities, supported by Federal Reserve rate cuts, improving earnings, broader market participation, and the absence of an AI-driven bubble.
Looking ahead, BMO suggested that 2025 may resemble the “Goldilocks” market environment of 1995–1996, with stable growth and supportive conditions setting the stage for further gains.
