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Pro: The 'everything rally'
Wells Fargo strategist Ohsung Kwon raised his year-end S&P 500 target to 7,950, implying over 5% upside from Monday's close, predicting an "everything rally" this summer as money flows into parts of the stock market untouched by the AI buildout. "Sentiment has reset, providing room for upside in the AI trade. Hyperscalers' race to raise capital is also a big tailwind for Semis & Infra," Kwon wrote. "With the war seemingly coming to an end, we expect a catch-up rally in cyclicals, at the expense of defensives." The S&P 500 has hit record highs this year, largely driven by chipmakers. The PHLX Semiconductor Index (SOX) has nearly doubled in 2026, on pace for its strongest year ever. Micron Technology, Arm Holdings, Marvell Technology, and Intel have surged 200% or more; Nvidia gained 14%, while AMD more than doubled. The rest of the market is also joining in: the equal-weighted S&P 500 rose 11.6%, slightly outpacing its market-cap-weighted counterpart. Kwon's PRSM framework—profits, rates, sentiment, macroeconomy—suggests further gains. "Profits and Rates (Liquidity) remain strong. Sentiment [is] now firmly neutral after sell-off. Macro concerns ease after Iran deal," he noted. Wall Street may also get a boost from the Federal Reserve's first two-day policy meeting under new Chairman Kevin Warsh. "We see the risk skewed to the upside for stocks with a hike already priced in," wrote Kwon. "We also see a scenario of a 'run it hot, inflate out' policy. Equities are the best hedge against inflation as long as the Fed doesn't fight it."