^GSPC Today, December 24: 2026 Targets Lean on Fed Cuts, AI Capex
The S&P 500 2026 forecast anchors near 7,500, with upside to 8,000 if Fed cuts run deeper and AI capex lifts earnings. The index, tracked by ^GSPC, trades near 6,932 after setting a fresh high at 6,937. For Japan-based investors, the two swing drivers are the path of policy and the size of data center and chip spending. We focus on what this means for yen portfolios, hedging choices, and sector tilts into 2026.
Where the index stands now
^GSPC is near 6,932, a touch below the 6,937 intraday high, and above its 50-day average at 6,779 and 200-day at 6,254. RSI sits at 61, while Stochastic %K is 94, signaling warm momentum. Bollinger upper band is 6,936, so near-term room is tight. The S&P 500 2026 forecast assumes pullbacks will be bought if breadth holds.
MACD is positive, and CCI is 146, which flags overbought risk on short time frames. ADX is 13, so the trend is not strong yet. We read this as a market that needs earnings upgrades to extend. If revisions firm through 2025, the 2026 setup improves, supporting the S&P 500 2026 forecast.
Fed cuts: the main swing factor
Deeper Fed easing would lower discount rates and support equity multiples. If inflation cools and growth stays stable, Fed rate cuts 2026 could add a valuation tailwind. If inflation is sticky, cuts may slow and multiples compress. The S&P 500 2026 forecast leans on the first path, but the policy mix will decide upside.
For yen investors, returns also hinge on USDJPY. Hedged U.S. equity exposure can reduce currency drag if the yen strengthens on Fed cuts. Unhedged exposure benefits if the dollar stays firm. We size hedges to risk budgets and rebalance on moves, keeping the S&P 500 2026 forecast in view but managing FX first.
AI capex and earnings power
AI spending 2026 is the second pillar. Larger data center budgets support semis, equipment, power, and select software. Stable unit demand plus rising services can lift margins. If delivery lags or budgets slip, earnings breadth narrows. That would reduce multiple support even with cuts. This is central to the S&P 500 2026 forecast.
We prefer quality tech, semis, and power infrastructure, balanced by health care and cash-flow consumer names. Watch free cash flow, pricing power, and backlog. Avoid single-theme concentration. If AI orders broaden to enterprise software and cybersecurity, beta rises. If not, quality factors should lead. Keep the S&P 500 2026 forecast but adjust tilts as data prints.
Targets and probabilities
Street scenarios cluster around 7,300 to 7,600 for 2026, assuming modest multiple expansion and mid-single-digit EPS growth. See context from Stock Market Outlook For 2026 and Can the S&P 500 Get to 8000?. The S&P 500 2026 forecast assumes steadier inflation and resilient margins.
An 8,000 print needs deeper or faster cuts, contained inflation, and steady AI-led capex. Earnings breadth must improve beyond megacaps. Searches like JPMorgan 8000 target show interest in this path, but delivery depends on policy and profits. The S&P 500 2026 forecast upgrades if revisions and liquidity both improve.
Final Thoughts
For Japan-based investors, two levers will shape outcomes into 2026. First, the rate path. Faster easing supports multiples, but sticky inflation caps gains. Second, AI capex. Broad and sustained spending can widen earnings leadership beyond a few names. We keep core U.S. exposure, size FX hedges to USDJPY risk, and update sector tilts as data center orders and earnings revisions arrive. Use buy-the-dip rules near rising 50-day averages, trim extremes near bands, and review position sizes monthly. The S&P 500 2026 forecast is constructive, but process and risk controls will drive realized yen returns.
FAQs
Two forces matter most. The pace of Fed easing and the size of AI-related capex. Faster cuts can lift multiples, while broader data center spend can raise earnings. For yen investors, hedge settings also matter because USDJPY can add or subtract from U.S. equity returns.
It is possible if inflation cools, Fed easing runs deeper, and AI spending 2026 remains strong across semis, equipment, and software. Broader earnings leadership would help. Without these, the index likely stays closer to base case levels around the mid-7,000s.
Keep quality U.S. exposure, favor cash-flow tech and health care, and size currency hedges to risk. If cuts speed up, consider adding cyclicals on strength. If cuts slow, lean into defensives. Rebalance around earnings updates and policy meetings, not headlines.
It reflects interest in an upside scenario where deep cuts and strong profits align. Treat it as a scenario, not a promise. Focus on earnings revisions, liquidity, and AI order trends. Keep diversification, set rebalancing rules, and review FX hedges for yen-based goals.
Disclaimer:
The content shared by Meyka AI PTY LTD is solely for research and informational purposes. Meyka is not a financial advisory service, and the information provided should not be considered investment or trading advice.
