The S&P 500 rose to a new all-time high on Thursday after reports indicated United States and Iranian negotiators had reached a proposed 60-day ceasefire agreement to begin talks on Iran's nuclear program. The broader equity index gained approximately 0.5% during the session, trading at 7,564.28 USD at press time with an intraday gain of 0.58%. The reported arrangement remains subject to approval from President Donald Trump, according to accounts citing U.S. officials and a regional source. The move extended a strong run for U.S. stocks, with the S&P 500 on pace for a ninth consecutive weekly gain, which would mark its longest winning streak since 2023. Goldman Sachs raised its year-end 2026 S&P 500 target to $8,000 from $7,600 on Thursday, citing stronger earnings projections driven by artificial intelligence infrastructure investment. The firm now expects index earnings per share to reach approximately $340 in 2026, representing 24% year-over-year growth, with companies tied to AI-related investment projected to account for roughly half of the S&P 500's earnings growth in 2026.
US-Iran Ceasefire Proposal Details
The reported memorandum of understanding would extend the ceasefire for 60 days and create a window for negotiations focused first on Iran's nuclear program. The proposal includes language stating that Iran would not pursue a nuclear weapon, while the United States would agree to discuss sanctions relief and the release of frozen Iranian funds. The framework is also expected to address shipping through the Strait of Hormuz. Under the reported terms, commercial shipping would remain unrestricted during the 60 days, while the U.S. Navy would scale back its blockade in line with the restoration of shipping activity. The memorandum would also include a mechanism intended to help Iran receive goods and humanitarian aid. The Strait of Hormuz remains a key route for global energy shipments, and market participants have closely tracked developments involving the waterway during periods of military tension. Reports of a possible easing in restrictions helped lift risk appetite across U.S. equities, although traders continued to monitor whether the White House would formally approve the agreement.
Goldman Sachs Raises Year-End Target Based on AI Earnings
Goldman Sachs raised its year-end S&P 500 target for 2026 to $8,000 from $7,600. The new forecast places Goldman alongside Morgan Stanley and Deutsche Bank, which have also issued year-end targets near $8,000. The revised level suggests further upside from the index's recent close near $7,519, with total return expectations supported by dividends. Goldman's forecast is based on stronger earnings projections for the S&P 500. The firm now expects index earnings per share to reach about $340 in 2026, representing 24% year-over-year growth. It also projects EPS of about $385 in 2027, pointing to continued profit growth beyond the current year. Artificial intelligence infrastructure remains central to Goldman's outlook. The firm estimates that companies tied to AI-related investment, including semiconductor firms and cloud infrastructure providers, could account for roughly half of the S&P 500's earnings growth in 2026. Goldman's analysis indicates that price gains have been supported by earnings revisions rather than only higher valuation multiples.
Treasury Yields and Earnings Concentration as Market Constraints
The concentration of earnings growth in AI-linked companies remains a key point for Wall Street strategists. A large share of projected profit expansion depends on continued spending by major technology companies on chips, cloud capacity, data centers and related hardware. Some market models have placed lower odds on the S&P 500 reaching $8,000, with higher probability ranges centered between $7,200 and $7,600. More cautious strategists have pointed to bond yields, economic growth, and Federal Reserve policy as possible constraints on further equity gains. The 10-year Treasury yield remains closely watched, particularly if it moves toward or above 4.75%. Higher yields could pressure equity valuations by making future earnings less attractive relative to fixed-income returns. Inflation data, especially core personal consumption expenditures, also remains important for expectations around monetary policy. Prediction markets also reflected rising attention on the S&P 500's path, with Kalshi forecasting there is a 60% chance of the index reaching 8,000 this year.
