Wells Fargo Raises S&P 500 Target, Citing Strong Earnings and AI Growth

Wells Fargo has increased its year-end 2026 S&P 500 target to 7,950, up from 7,300, driven by higher earnings-per-share estimates rather than market exuberance. The bank's optimism stems from easing geopolitical tensions and a strong outlook for AI spending, particularly in cyclical stocks, semiconductors, and infrastructure. Despite acknowledging some market froth, Wells Fargo believes the broader market's earnings engine remains robust, though risks related to AI capital spending and market breadth bear watching.