Brian Belski's 2026 S&P 500 Outlook: 7,300-7,500 Amid Earnings Growth

Market Outlook for 2026

• 🎯 Brian Belski, CEO of Humilis Investment Strategies, forecasts the S&P 500 to end 2026 between 7,300 and 7,500.
• 📈 He anticipates high single-digit to low double-digit returns for the S&P 500 and Canadian markets, contrasting with the higher gains of previous years.
• ⚠️ Belski suggests that year three of a bull market, which he believes will occur in year four, is typically the most challenging.

Sector and Strategy Focus

• 💡 The strategy involves neutralizing tech holdings and overweighting communication services, financials, and utilities due to their secular earnings growth potential.
• 💰 Financials are highlighted as an area that institutions are still under-owning, presenting an opportunity.
• 🚀 A rotation into value, dividend growth, and small/mid-cap equities is expected, with small/mid-caps showing strong free cash flow and potential for M&A activity.

Market Dynamics: Earnings vs. Multiple Expansion

• 📊 Belski explains that the market is transitioning from a valuation-driven environment to an earnings-driven market, which historically yields lower returns.
• 📈 While acknowledging strong earnings growth potential, he notes that with the S&P 500 already at 22 times earnings, significant multiple expansion is unlikely.
• ✅ Despite lower expected returns compared to previous years, the outlook remains positive, focusing on tactical opportunities within the market.

Tactical Opportunities and Market Dispersion

• 🔍 Tactical opportunities are identified in areas like money center banks, trust banks, and exchanges such as NASDAQ.
• 📈 Companies like Interactive Brokers and Charles Schwab are performing well, and positive impacts are seen in fintech following events in Venezuela.
• 💡 The performance of semiconductors indicates that technology remains a key area, even if broader tech sentiment wavers.
• 🧩 Market dispersion is viewed as a positive sign, encouraging a focus on company-specific fundamentals and competitive positioning to drive participation in earnings growth and potential multiple expansion.