Investing.com — Yardeni Research believes the worst is behind U.S. equity markets, declaring that the March 30 low marks the bottom for stocks this year and reiterating a year-end S&P 500 target of 7,700.
The firm drew a historical parallel to the 1956 Suez Crisis, when the closure of the canal sent sharply higher, and the fell roughly 10% before recovering to new highs the following spring.
“With the exception of the 1970s, geopolitical oil supply shocks have tended to be buying opportunities for stocks,” Yardeni wrote.
Iran’s blockade of the Strait of Hormuz and the U.S. blockade of Iranian ports remain in place, with weekend peace talks in Islamabad failing to materialize.
Yardeni’s base case calls for “the S&P 500 to chop around 7,000 while the stalemate holds, then grind higher in the second half of this year” toward the 7,700 target, assuming a deal by mid-year.
The firm noted that a resilient earnings picture reinforces the bullish outlook. S&P 500 forward EPS hit a fresh record of $344.30 last week, with consensus estimates of $326.78 for 2026 and $380.37 for 2027, both continuing to be revised higher.
Yardeni also noted that 82.6% of S&P 500 companies now show positive forward earnings growth, with breadth potentially reaching 90% later this year.
On credit, commercial bank loans and leases are up 7.1% year over year, the fastest pace in roughly three years, which Yardeni cited as a key reason it does not anticipate a recession.
