Prediction markets see 66% odds S&P 500 hits 8,000 in 2026

Traders on prediction platforms now see the S&P 500 reaching 8,000 this year as more likely than not.

Prediction-market traders now assign about a 66 percent chance the S&P 500 reaches 8,000 in 2026, after the benchmark closed at a record 7,736.52 on Tuesday. The advance came as the AI trade reignited following a late-June and July slump, lifting the index more than 5 percent over four sessions.

"The economy is doing very well, and earnings are reflecting that S&P 500 forward earnings is up more than 30 percent year over year," Ed Yardeni, president of Yardeni Research, said in a blog post, calling his 8,250 year-end target "increasingly conservative" with the index about 6.5 percent away.

On Kalshi, traders assigned a 91.7 percent probability the index reaches 7,800 or higher in 2026, with odds of 8,000 or above at 72.8 percent. The probability of climbing to 8,200 stood at 29.2 percent, followed by 17.7 percent for 8,400, 12.9 percent for 8,600, 11.3 percent for 8,800 and 6 percent for 9,000 or higher.

The bullish positioning carries implications for fund flows and options activity, with retail sentiment on the SPDR S&P 500 ETF Trust improving from bearish to neutral over 24 hours on Stocktwits. The S&P 500 is up nearly 13 percent this year.

Retail Bets Point to 8,000 by Month-End

A Barchart poll on X found 53.7 percent of 1,740 voters expect the index to notch 8,000 by month-end, implying a gain of about 3.4 percent from current levels. On Polymarket, traders assigned an 89 percent probability that the SPDR S&P 500 ETF Trust, which tracks the index, rises above $780 in August, with 49 percent odds of a move above $790 and 28 percent for $800. SPY last closed at $771.33; the targets imply gains of 1.1 percent, 2.4 percent and 3.7 percent, respectively.

A separate Polymarket contract on where the S&P 500 finishes 2026 showed traders assigning the highest probability, 29 percent, to the index ending above 8,000. The next most likely outcomes were a finish between 7,000 and 7,500 and between 7,500 and 8,000, each with 21 percent odds.

Earnings Momentum Fuels the Rally

Yardeni pointed to the ISM manufacturing PMI climbing to a four-year high in July, noting that historically stronger manufacturing activity has been associated with stronger earnings growth. The benchmark's advance has been driven by renewed optimism over AI investment and solid second-quarter corporate earnings, alongside easing tensions in the Middle East.

On Stocktwits, retail sentiment on the iShares Core S&P 500 ETF was bullish at the time of writing, with one user posting "$SPY 800 coming sooner than expected."

This article is for informational purposes only and does not constitute investment advice.