Strategist's Bold 2026 Market Forecast

Investment strategist Warren Pies has demonstrated a keen eye for market trends, making accurate calls on stocks, bonds, and oil throughout 2025. His S&P 500 forecast from late 2024 is proving prescient as 2025 concludes. Pies suggests many investors are overly fixated on current market overvaluation, potentially missing broader risks. He anticipates that the positive stock market momentum seen at the end of 2025 will likely persist into early 2026.

Pies accurately predicted a correction in the S&P 500 during the first half of 2025 and made timely adjustments to his firm's stock allocations. He also foresaw multiple Federal Reserve rate cuts and a bearish trend in crude oil prices, which contributed to an inflationary tailwind. A significant achievement was forecasting the high for the 10-year Treasury note yield in January and its subsequent decline below 4% in the latter half of the year.

Despite a strong outlook for the Fed and general economic optimism, Pies expresses concern about the widespread optimism heading into 2026. He anticipates that a shakeout in market sentiment will be necessary during the first half of the year, similar to 2025, though perhaps less severe. This adjustment is intended to temper the prevailing optimistic outlook and prepare for underlying economic realities.