Wall Street predicts multiple positive catalysts for the US stock market in 2026

On January 12, Wall Street strategists believed that in 2026, the U.S. economy and stock market may continue their upward trend, driven by factors such as expectations of Federal Reserve rate cuts, tax incentives from Trump's "Big and Beautiful Act," easing inflation, and productivity improvements brought by AI. The latest CPI data is expected to remain at 2.7% year-on-year, and the downside potential for inflation may exceed expectations. The cooling labor market provides policy space for the Federal Reserve to cut rates, and declining U.S. Treasury yields may reduce financing costs. Goldman Sachs expects AI to drive a 12% increase in S&P 500 earnings per share in 2026. Analysts remind that the substitution risk of AI for employment may bring instability.