Yardeni Raises S&P 500 Target to 8,400 Amid Earnings Momentum

Wall Street bull Ed Yardeni has raised his year-end S&P 500 target to 8,400 points for the third time this year. He believes that as long as the U.S. economy avoids recession, there is an 80% probability the 'Roaring 2020s' will continue. According to Yardeni, the current market is driven by earnings momentum rather than speculative sentiment, with valuations far below dot-com bubble levels.

Yardeni warned that surging oil prices pose the greatest risk and could force central banks to resume rate hikes. He also cautioned against chasing individual AI stocks directly, recommending diversified positioning through vehicles such as Nasdaq-100 index funds instead. Yardeni favors sectors that benefit from AI applications, including financials, healthcare, industrials, and energy.

The expert remains bullish on gold, citing continued central bank accumulation and reduced dollar reserves. However, he lowered his year-end gold target from $5,500 to $5,000 due to the metal's poor performance in the face of geopolitical crises.