Optimism on Wall Street is far from fading. Analysts at UBS say the S&P 500’s record-setting run still has fuel left, thanks to a potent mix of resilient consumers, corporate strength, and the accelerating impact of artificial intelligence across industries.

The bank’s strategists told clients they expect another upbeat earnings season, with profits for companies in the index projected to jump roughly 10% in the third quarter. This, they argue, will confirm that the bull market remains well-supported rather than overextended.

Why UBS Thinks the Rally Isn’t Over

UBS credits the economy’s staying power to healthy consumer activity. Even as job growth moderates, paychecks are still rising and layoffs remain minimal – conditions that continue to underpin household demand. Those spending habits, the bank says, are helping companies maintain both revenue and earnings momentum.

Artificial intelligence has also become an increasingly important part of UBS’s bullish thesis. Corporate investment in AI-related infrastructure, particularly in cloud computing, has not slowed despite recent volatility. The bank expects that continued adoption will lead to upward revisions in earnings forecasts for major technology firms before year-end.

Policy and Market Context

Adding to the optimism, UBS expects the Federal Reserve to begin easing interest rates, a shift it says should further lift investor sentiment. Combined with steady profit growth, the move could strengthen the market’s foundation into early 2026.

The forecast arrives as the S&P 500 trades near historic highs, currently around 6,677 – up 13% year-to-date. Despite ongoing trade tensions between Washington and Beijing, UBS believes the broader narrative remains one of economic resilience and innovation-led expansion.

In short, while skeptics warn that equities are running hot, UBS sees the opposite: an economy that’s adapting, a market that’s maturing, and a bull run that isn’t ready to end.