Wall Street firmly bets on the AI wave: in recent years there is no "AI bubble", S&P 500 index aims for 10,000 points.

As the US stock market continues to hover near historic highs, top strategists on Wall Street are increasingly downplaying concerns related to the AI bubble. They are envisioning the S&P 500 index and the Nasdaq 100 index, dubbed the "global tech stocks benchmark," to continue their strong bull market trend from 2023 to at least 2026. With only three trading days left in 2025, the S&P 500 index is expected to close with a more than 18% increase for the year, led by the "Magnificent Seven" in the tech sector with a 26% surge. "I currently don't see a bubble. However, I do believe we will enter a new bubble," said Mary Ann Bartels, chief investment strategist at Sanctuary Wealth, in a recent interview. Bartels compared the current market to past bubble periods, such as the late 1920s and the global stock market bear market following the burst of the internet bubble in 2000. Like Ed Yardeni, known as the "prophet of Wall Street," this strategist predicts that by 2030, the S&P 500 index will be between 10,000 and 13,000. While ordinary investors in the stock market are increasingly worried about a potential bear market due to the burst of the "AI bubble" reminiscent of the dot-com bubble burst, this is not the consensus view on Wall Street. Strategists at Bank of America Corp Global Research wrote in a report last Wednesday that they have "not yet seen any degree of an AI bubble." According to data compiled by analysts at Jefferies Financial Group Inc., Wall Street analysts generally expect overall profit growth of S&P 500 index component companies to accelerate yearly and continue until 2027. Goldman Sachs analysts recently indicated that the surge in the AI investment frenzy, coupled with financial concerns and liquidity pressure in the private credit market, has led to increasing worries about the imminent burst of the "AI bubble." However, they believe that the tech valuations are not extreme yet compared to previous market frenzy periods. Despite concerns about high valuations of tech giants, the AI investment boom is different from the dot-com bubble era. Companies like Alphabet, Microsoft, and Amazon, with strong cash flows, are driving the AI wave with solid profits, unlike the unprofitable newcomers leading the charge during the dot-com bubble. Looking ahead to 2026, strategists expect that semiconductor stocks will continue to lead the market, with AI chip manufacturers like NVIDIA reshaping the landscape with game-changing technologies. The AI chip industry is expected to expand significantly, with the potential for continued investment in AI infrastructure. Overall, the outlook for the stock market in 2026 is bullish, with a focus on AI investments and the tech sector, led by companies like NVIDIA. The AI frenzy is expected to drive profitability and support the ongoing bull market trend in the US.