Yardeni Research believes the March 30 low represents the bottom for U.S. stocks this year and has reaffirmed its year-end S&P 500 target of 7,700.
The firm compares the current environment to the 1956 Suez Crisis, when the canal's closure pushed crude prices sharply higher and the Dow Jones Industrial Average dropped roughly 10% before recovering to fresh highs the following spring. "With the exception of the 1970s, geopolitical oil supply shocks have tended to be buying opportunities for stocks," Yardeni wrote.
Yardeni pointed to ongoing geopolitical frictions as a continuing influence on markets: Iran's blockade of the Strait of Hormuz and the U.S. blockade of Iranian ports remain in place, and weekend peace talks in Islamabad failed to materialize. The firm said its base case assumes that while this stalemate persists the S&P 500 is likely to "chop around 7,000," then to "grind higher in the second half of this year" toward the 7,700 target, provided a deal is reached by mid-year.
Beyond geopolitics, Yardeni emphasized that a firm earnings outlook underpins its bullish stance. The S&P 500 forward earnings per share reached a record $344.30 last week. Consensus estimates cited by the firm stand at $326.78 for 2026 and $380.37 for 2027, and both series continue to be revised upward.
The report also highlighted breadth in earnings growth, noting that 82.6% of S&P 500 companies now show positive forward earnings growth, with the potential for that breadth to expand to 90% later in the year.
On the credit side, Yardeni flagged an acceleration in commercial bank lending: loans and leases at commercial banks are up 7.1% year over year, the fastest pace in roughly three years. The firm cited that improvement in credit flows as a central reason it does not anticipate a recession.
In sum, Yardeni combines the historical analogy to past oil-supply shocks, the persistent geopolitical disruptions, the record forward EPS reading and improving bank lending to justify its view that the March 30 low is the low for the year and that the S&P 500 can reach 7,700 by year-end under its base-case assumptions.