Market sentiment turns bearish as Ed Yardeni lowers his S&P 500 target and the Federal Reserve signals additional rate hikes to combat persistent inflation.
Analyst Ed Yardeni lowered his year-end 2026 S&P 500 target from 8,400 to 7,900 and pushed the 8,400 target to mid-2027 due to rising bond yields and the Fed's rate hike.
Hedge fund manager Doug Kass predicts a top in the S&P and Nasdaq indices and plans to short indices on any rally following the Fed decision.
U.S. action in Iran crimped oil supply and sent gas prices soaring, adding to inflation pressures that drove the Fed to raise rates.
Analyst Ed Yardeni has lowered his 2026 S&P 500 year-end target from 8,400 to 7,900, citing rising bond yields and the Federal Reserve's decision to hike interest rates. The Fed raised rates to a 3.75%-4% range, signaling further tightening to combat inflation fueled by energy supply constraints.
Yardeni lowered his target because rising 10-year Treasury yields have made bonds more competitive with stocks and forced a reduction in the index's forward P/E multiple.
The Fed has shifted to a more hawkish stance, raising rates to 3.75%-4% and signaling potential further hikes to address inflation driven by energy supply issues.