What to expect over the next 12 months from S&P 500 returns
Yahoo Finance ·
What to expect over the next 12 months from S&P 500 returns Yahoo Finance Video Wed, September 2, 2026 at 10:21 AM EDT ^GSPC SPGI Yahoo Finance Executive Editor Brian Sozzi speaks with Goldman Sachs Chief Global Equity Strategist Peter Oppenheimer about the projected returns from the S&P 500 ( ^GSPC ) for the next 12 months. If we continue to get this gradual increase, at what point do investors sit back, let's say in two, three weeks and say, you know what, we need to readjust our expectations for the S&P 500. You know, the S&P 500 with yields at these levels, even though rising gradually, the S&P should be seven or 8% below where it is now. Well, firstly, we should acknowledge that the S&P and indeed other equity markets around the world have had a phenomenal uh return over the course of the last year and year to date. So we've already had a lot of good returns behind us. We would expect lower returns from here at any rate. But bear in mind part of the rise in bond yields we're seeing is because inflation expectations have picked up. And that's actually adding to nominal GDP, GDP including inflation, which is really what drives the revenues of companies. So to some degree, there is a bit of a cushioning, I think in equities, but it's right to say that with these higher costs of capital that companies are having to endure and investors are having to factor into their valuations. We would expect to see a more moderate rise in equity prices over the remainder of the year if bond yields continue to stay at these levels or edge higher. Pier, when you say lower returns from here, are you talking about low single digits, mid-single digits? Yeah, it depends on where, but in most places we're talking about mid to high single digit returns over the next 12 months, lower than we've been seeing in every region in the last 12 months, but still, you know, relatively decent so long as economic growth continues, that's our expectation, and also that we get ongoing profit growth uh continuing to be reasonably solid. Now again, let's be clear, it's unlikely to remain as strong as we've just been seeing. You mentioned some of the really stellar uh earnings numbers that have just been released, but in the US, the S&P, for example, in the first half of the year, we've seen profits growing at about 33% year-over-year, even when you exclude uh some of the uh one-off effects from revaluation of private investments that some of the big tech companies have. So very, very strong profit growth. It's not likely to continue at that pace moving forwards. And that's really what I think is going to slow the returns in equities, but with economic activity continuing, we should still see a moderately positive, I think.
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