UBS expects the S&P 500 to reach 6,800 by mid-2026

Across the Atlantic, sentiment is beginning to improve. UBS has raised its mid-2026 forecast for the S&P 500 to 6,800 from 6,200, though the bank is keeping a neutral stance, suggesting much of the potential upside may already be priced in.

Morgan Stanley expects a rebound that could lift the index to 6,500 by mid-2026, with a bullish case scenario of 7,200 — a roughly 12% climb from current levels.

The UK Outlook

In Britain, the picture looks more subdued. Fidelity anticipates markets may remain range-bound through the rest of 2025, with dividends rising just 2% this year and a more meaningful recovery delayed until 2026. JPMorgan forecasts mid-teen earnings-per-share growth, while Schroders sees gains of about 12%. Vanguard is more cautious, projecting GDP growth of just 0.8% heading into 2026, as fiscal tightening and a softer labour market weigh on momentum. Still, expected rate cuts — from 4% in 2025 to 3.25% by mid-2026 — could offer some relief.

Stocks to Watch

Analysts have highlighted several FTSE 100 names as potential outperformers in the year ahead, including Games Workshop, NatWest, 3i Group, Rolls-Royce, BAE Systems, RELX, London Stock Exchange Group, and Halma.

One company drawing particular attention is Tritax Big Box REIT (LSE: BBOX). Known for its logistics portfolio, the group is expanding into data centres, positioning itself to benefit from surging demand for digital infrastructure driven by the rapid adoption of AI.