Yardeni Cuts S&P 500 Target as Bond Yields Rise

The stock market opened higher on Wednesday as investors focused on the Federal Reserve's interest rate decision. Ed Yardeni, a well-known economist, lowered his year-end S&P 500 target to 7,900 from 8,400 due to rising bond yields and increased downside risks over the next three to six months. This implies a 4.1% gain from Tuesday's close.

Yardeni also reduced his forward P/E assumption to 18.6 from 19.8. The economist cited higher interest rates as a major contributor to this change, which is expected to have a significant impact on the market in the coming months.

Apollo Global Management has estimated that restoring U.S. industrial capacity and strengthening critical supply chains could require as much as $6.5T in new investment. This would help increase manufacturing's share of U.S. GDP, currently around 9%, from nearly 28% in the 1950s.

Nvidia, Emerald AI, and Google have formed the AI Energy Management Alliance to improve how data centers respond to electricity-grid conditions. The group aims to promote workload shifting, energy storage, and demand reductions during periods of grid stress, potentially helping AI operators use existing power capacity more efficiently.