Wall Street eyes S&P 500 at 6,200-7,000 and Nasdaq 100 above 23,000 by year-end 2025​

Current market positioning and analyst outlook

​As of the end of the second quarter on 30 June 2025, the S&P 500 was trading around 6,205, while the Nasdaq 100 stood near 22,679. Analysts from major investment banks anticipate continued growth through the end of the year, driven by robust earnings, easing inflation, and supportive monetary policies.

​The current positioning of both indices reflects the strong performance that has characterised much of 2025, except a sharp drop in early April, with technology stocks continuing to lead the broader market higher despite periodic concerns about valuations and economic uncertainty.

​Wall Street's optimistic projections come amid a backdrop of resilient corporate earnings, improving economic data, and expectations that the Federal Reserve (Fed) may adopt a more accommodative stance as inflation continues to moderate.

​These forecasts represent a continuation of the bull market that has driven US equities to successive new highs, though analysts acknowledge that achieving these targets will depend on several key factors aligning favourably.

​S&P 500 targets range from 6,400 to 7,100

​Wall Street's projections for the S&P 500 by December 2025 are generally optimistic, with Deutsche Bank forecasting 7,000, supported by increased corporate buybacks and robust equity inflows. Morgan Stanley maintains a 6,500 target, expecting earnings growth and post-election corporate optimism.

​Goldman Sachs projects 6,200, around current levels, reflecting a 12% total return with dividends, driven by continuous US economic expansion. UBS recently raised its target to 6,200, banking on softening trade uncertainties.

​The median forecast among major banks stands at approximately 6,600, implying a potential 6% gain from current levels. This range of targets reflects different assumptions about economic growth, corporate earnings, and policy developments.

​The variation in targets demonstrates that while the overall direction is viewed positively, there remains uncertainty about the magnitude of gains and the specific catalysts that will drive performance in the second half of the year.

​IG’s technical analysis of the S&P 500

​While the 23 June low at 5,943 underpins on a daily chart closing basis, the 161.8% Fibonacci extension of the October 2023-to-March 2024 uptrend, projected higher from its April 2024 low, at 6,832.17 will remain in sight.

​Slightly further up sits the 261.8% Fibonacci extension of the October 2022 low-to-July 2023 uptrend, projected higher from the October 2023 low, at 7,024.13.

​S&P 500 weekly candlestick chart 

​Since both Fibonacci extension targets are relatively close together, the 6,832-to-7,024 area represents a technical upside target zone for the S&P 500.

​Nasdaq 100 momentum expected to continue

​For the tech-heavy Nasdaq 100, analysts foresee continued momentum with may projections exceeding 23,000. These projections indicate a possible 5% to 10% increase from current levels, contingent on factors like Fed monetary policy and global economic stability.

​The technology sector's resilience and continued innovation in areas like artificial intelligence (AI), cloud computing, and digital transformation provide fundamental support for higher valuations in the index's largest constituents.

​Nasdaq 100 performance has been particularly sensitive to interest rate expectations, as technology companies with high growth rates and future cash flows are more vulnerable to changes in discount rates applied by investors.

​The continued dominance of mega-cap technology stocks within the index means that the performance of companies like Apple, Microsoft, Amazon, and Nvidia will largely determine whether these ambitious targets are achieved.

​IG’s technical analysis of the Nasdaq 100

​The Nasdaq 100 is fast approaching its 161.8% Fibonacci extension of its October 2022-to-July 2023 bull market, projected higher from its October 2023 low which comes in at 22,943.43. Together with the psychological 23,000 mark it may not just act as a potential upside target but also a resistance zone.

​Nasdaq 100 weekly candlestick chart 

​Another potential upside target is the 161.8% Fibonacci extension of the October 2023 low to the March 2024 high bull run, extended higher from the April 2024 low, which comes in at 24,103.45. It represents a near 7% rise from current levels (as of the daily close made at the end of June 2025).

​Earnings growth drives bullish sentiment

​Analysts anticipate S&P 500 earnings per share (EPS) to grow by approximately 14.8% in 2025, supporting higher index valuations. This robust earnings growth expectation provides fundamental justification for the bullish price targets being set by major investment banks.

​The earnings growth projection reflects expectations of continued economic expansion, margin improvement from operational efficiency gains, and revenue growth across multiple sectors beyond just technology.

​Corporate profit margins have remained resilient despite cost pressures, with companies demonstrating pricing power and operational leverage that supports expanding profitability even in a moderating growth environment.

​The quality of earnings growth, with broad-based participation across sectors rather than concentration in a few high-growth areas, provides additional confidence in the sustainability of current valuation levels.

​Federal Reserve policy remains critical factor

​The Federal Reserve's (Fed) stance on interest rates remains a critical factor, with potential rate cuts influencing market dynamics. Current expectations suggest that the Fed may be cutting rates twice later in 2025 if inflation continues to moderate and economic growth shows signs of slowing.

​Lower interest rates would provide support for equity valuations by reducing the discount rate applied to future cash flows and making bonds less attractive relative to stocks for income-seeking investors.

​However, the path of monetary policy remains data-dependent, with the Fed balancing the need to prevent economic overheating against the risk of tightening too aggressively and triggering a recession.

​Market sensitivity to Fed communications and economic data releases suggests that any deviation from expected policy paths could significantly impact the achievement of year-end targets for both indices.

​Geopolitical and economic risk factors

​Developments such as trade policies and international tensions could impact investor sentiment and market performance. The ongoing evolution of US-China trade relationships, European economic stability, and Middle Eastern geopolitical tensions all represent potential headwinds, even if investors expect these to have died down for the time being.

​Trade policy developments, particularly any changes to tariff structures or international economic agreements, could affect corporate earnings and investor confidence in ways that might challenge current bullish projections.

​Global economic coordination and central bank policies beyond the Fed will also influence capital flows and relative attractiveness of US equities compared to international alternatives.

​Corporate earnings in sectors exposed to international markets could face pressure from currency fluctuations, trade disruptions, or changes in global demand patterns that might affect the broad-based earnings growth assumptions underlying current targets.

Investment implications and trading considerations

​For investors looking to position themselves around these Wall Street projections, several approaches merit consideration given the generally bullish but varied target ranges.

1. ​Research the fundamental drivers behind analyst projections, including earnings expectations, monetary policy assumptions, and economic growth forecasts.
2. ​Consider how different scenarios might affect your portfolio allocation and risk management strategies.
3. ​Open an account with IG by visiting our website and completing the application process.
4. ​Access US equity markets through our platform, including both S&P 500 and Nasdaq 100 exposure.
5. ​Implement appropriate diversification and risk management given the potential volatility around economic and policy developments.

​CFD trading and spread betting provide flexible approaches for gaining exposure to US equity index movements, allowing positions on both rising and falling markets.

​For those with longer-term investment horizons who believe in the structural growth story of US equities, direct exposure through index funds or individual stocks may be appropriate.

​In summary, while forecasts vary, the consensus among major investment banks points toward a positive trajectory for both the S&P 500 and Nasdaq 100 by the end of 2025, underpinned by strong corporate earnings and supportive economic policies.

​The achievement of these- sometimes ambitious - targets will depend on the continued execution of corporate earnings growth, favourable monetary policy developments, and the absence of a resurgence of major geopolitical or economic shocks that could derail the current positive momentum in US equity markets.