Citigroup lifts S&P 500 2026 target to 8,100, cites AI

Citigroup raised its S&P 500 year-end 2026 target to 8,100 from 7,700 and lifted its 2026 S&P 500 earnings-per-share forecast to $350 in a note dated June 5. The bank also set a preliminary S&P 500 EPS target of $400 for 2027. The 8,100 target implies roughly a 10% upside from the index’s most recent close. The S&P 500 has climbed about 8% so far this year but fell sharply after stronger-than-expected U.S. nonfarm payrolls data.

Citigroup’s strategists linked the higher target to increased corporate investment in artificial intelligence and stronger profit outlooks across sectors. The bank wrote, “We have high confidence in continued earnings beats through year-end.” It added that AI-related spending is broadening beyond technology firms and could raise revenue and margin expectations for a wider set of companies.

The strategists warned that growth tied to AI beyond 2027 is uncertain. The note stated, “persistence of AI-driven growth beyond 2027 remains a key question.” It also said, “our view is that this is not a traditional cycle and looks more like a one-time capex supercycle, thus increasing the burden on earnings growth and related expectation to drive index price action.” The bank wrote investors will focus on whether companies can deliver the productivity improvements expected from their AI investments.

Citigroup flagged risks to its outlook including inflationary pressure and supply disruptions linked to conflict in the Middle East that could affect costs and global trade.

Separately, the bank announced plans to hire roughly 100 private bankers globally and nearly 400 specialists as part of a restructuring of its wealth business led by Chief Executive Jane Fraser. In Hong Kong, Andy Sieg, head of global wealth, described Asia as “the fastest growing part of our private bank” and “the most productive area of the private bank,” and indicated the region will receive a substantial share of the planned hiring.

The forecasts and the hiring plans were presented by Citigroup alongside its June note and public remarks by senior executives.