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The S&P 500 climbed above 7,000 points for the first time on Wednesday as stocks recovered from a selloff triggered by last week’s Greenland crisis and investors turned their attention back to corporate earnings.
The Wall Street benchmark, which has posted double-digit returns in each of the past three years, rose 0.3 percent in early trading to 7,002 points, before clawing back to trade marginally lower in early afternoon in New York.
The milestone comes as stocks offset sharp losses caused by Donald Trump’s tariff threats on Greenland – when the blue-chip index fell 2.1 percent in one session – and despite broader market volatility caused by a currency and bond selloff in Japan.
Investors’ attention has turned to what analysts expect to be a strong earnings season, with Big Tech companies Microsoft, Meta and Tesla scheduled to report earnings later on Wednesday, followed by Apple on Thursday.
Tech stocks led early gains after Dutch chip manufacturing equipment maker ASML on Wednesday forecast bumper sales this year due to the AI boom.
Nvidia rose 1.3 percent, while Tesla was up 1 percent ahead of its results.
Deutsche Bank analysts are predicting one of the strongest quarters for earnings since the 2008 financial crisis, barring a post-pandemic recovery, in terms of year-over-year growth.
Earnings season is “likely to put a floor under the tariff noise,” said Matthias Scheiber, head of the multi-asset team at Allspring Global Investments.
Wall Street analysts are almost unanimously predicting a fourth consecutive positive year for the S&P, which surpassed the 6,000 mark in late 2024 and whose gains in recent years have been largely driven by the booming tech sector.
These predictions come despite Trump’s erratic policymaking and fears in some quarters that Silicon Valley’s huge AI investments may fail to pay off.
“S&P 500 hits 7000 for the first time. America is back!!!” the US President wrote on his Truth social platform on Wednesday.
Strategists also expect US interest rates to fall no matter who replaces Jay Powell as Federal Reserve chairman in May, providing a tailwind for stocks. The Fed is expected to make no changes in rates at its meeting on Wednesday.
The Trump administration is rolling back capital requirements imposed on big banks after the financial crisis, which analysts also expect to boost economic growth.
Goldman Sachs forecasts the S&P 500 to end the year at 7,600, representing a gain of about 8.5 percent, which is slightly above the average forecast of other major banks.
Ben Snyder, chief U.S. equity strategist at Goldman, said “healthy economic and revenue growth, continued profit strength among the largest U.S. stocks and emerging productivity gains from AI adoption” will drive bull market momentum this year.
