Why one Wall Street firm thinks this year's stock-market rally is running out of road

Wells Fargo is the latest Wall Street firm to dial down expectations for U.S. stocks, reducing its S&P 500 year-end target. Strategists led by Ohsung Kwon cut the index target to 7,700 from 7,950 after the S&P 500 closed Monday just below 7,620, up 11% for the year. The new forecast implies only about 1% more upside through the end of 2026, even as the bank becomes more optimistic on earnings per share, projecting $425 for 2026 and $460 for 2028. Wells Fargo flags risks that AI data-center capex could slow, pressuring longer-term earnings growth.