A bold 2011 market call is echoed in 2026
A bold 2011 market call is echoed in 2026
Sam RoSun, March 29, 2026 at 6:02 PM UTC
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A version of this post first appeared on TKer.co
In fall 2011, global stock markets tumbled amid increasing concerns over sovereign debt levels. Debt crises gripped Greece, Ireland, Portugal, and Spain. S&P even stripped the U.S. of its pristine AAA sovereign credit rating.
The S&P 500 fell 19% from its July 7 closing high of 1,353 to its Oct. 3 closing low of 1,099.
It was the kind of move you’d think would have Wall Street strategists tripping over each other as they cut their targets for the market.
But on Sept. 11, when the S&P was at 1,154, then-BofA strategist David Bianco raised his 12-month forecast on the S&P to 1,450 from 1,400. This implied a very bullish 26% return. In his note, he also suggested the market could surge 15% from Sept. to January.
At the time, his calls were widely criticized as delusional optimism. I even wrote that he was the "gutsiest strategist in the world right now." (Three days later, BofA and Bianco parted ways. He later joined Deutsche Bank as their top equity strategist. Today, he’s CIO at DWS.)
David Bianco, CIO at DWS. (Source: UBS GWM) (Yahoo Finance)
Well, Bianco nailed both calls.
The S&P surged 15% from September to the end of January. And it hit 1,450 on Sept. 13, 2012 — 12 months and two days after he set his 12-month target.
The S&P 500 tumbled into fall 2011 and staged an impressive rally for much of 2012. (Yahoo Finance)
I was reminded of this episode this week because Barclays’ Venu Krishna raised his year-end target for the S&P 500 to 7,650 from 7,400. This, despite the market pulling back amid heightened uncertainty and elevated energy prices stemming from the conflict in Iran.
"Our baseline is that concerns over AI disruption, private credit, and geopolitics reflect real and material risks, but ones that will nonetheless fall short of derailing the current growth cycle at this point in time," he said.
A key driver of his call is his expectation for S&P 500 earnings to grow to $321 per share this year, up from his initial estimate of $305.
If you only have time for one metric, it should be earnings. They’re the most important long-term driver of stock prices. And according to FactSet, earnings estimates have been drifting higher.
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Earnings estimates continue to trend higher. (Source: FactSet) (Yahoo Finance)
As Schwab’s Kevin Gordon often says, we have to distinguish between front-page risk and bottom-line risk. Stories on the front page may spark market volatility. But those stories matter to the stock market only to the degree they affect the bottom line, or earnings.
And so far, the earnings narrative continues to be bullish.
Let’s not forget about 2025 🗓️
It’s not breaking news that the stock market behaves unpredictably and sometimes counterintuitively.
Going into 2025, Wall Street strategists had year-end S&P 500 targets ranging from 6,400 to 7,100.
As the Trump administration rolled out its aggressive trade policy, markets tanked, and strategists slashed their targets. Almost all strategists had revised targets below 6,400.
But to many people’s surprise, the S&P eventually recovered losses and closed the year at 6,845, an impressive 16% gain. That closing price was actually higher than most strategists’ targets at the beginning of the year.
The S&P cratered in early 2025, but quickly recovered losses to close the year higher. (Yahoo Finance)
Despite the policy headwinds, earnings growth persisted, helping prices climb to new record highs.
Zooming out 🔭
To be clear, this is not me suggesting you should lean on a Wall Street strategist’s one-year target for the stock market. I would never do that.
I’m also not suggesting that markets are sure to recover and rise above everyone’s targets. Things could get worse, and 2026 could be a crappy year.
All I’m saying is that good stock market analysis sometimes yields contrarian findings, even when front-page news and recent price performance point in the opposite direction.
The stock market will do unexpected things, especially over short periods like one year. So don’t be too surprised if we ultimately get better-than-expected results despite what appears to be worsening market conditions.
A version of this post first appeared on TKer.co
Source: “AOL Money”
