One of Wall Street’s most bullish strategists is hitting the brakes.
Julian Emanuel of Evercore ISI, previously known for his outsized optimism on U.S. equities, slashed his year-end target for the S&P 500 to 5,600, down from a lofty 6,800, as stagflation and global trade turmoil darken the macro outlook.
On Friday, the S&P 500 plunged 6%, closing at 5,074.08, its worst single-day loss since the pandemic-driven crash of 2020. Though the new target still reflects a potential 10% upside, the sharp downgrade highlights the increasing concern among top strategists about economic fragility in the face of aggressive U.S. tariff policies.
“The prolonged uncertainty has raised asset volatility, damaged confidence, and increased the odds ‘soft’ data eventually ‘infects’ the ‘hard,’ causing stagflation or outright recession,” Emanuel wrote in a note to clients on Sunday.
Revised Assumptions Reflect Market Stress
Alongside the lowered index target, Emanuel also cut his 2025 earnings forecast for the S&P 500 to $255 per share, down from $263, and revised his forward price-to-earnings (P/E) ratio down to 20.6 from 23.7. Both changes suggest a more cautious outlook on corporate profitability and investor sentiment in the coming quarters.
He pointed directly to the Trump administration’s aggressive trade strategy—including sweeping new tariffs and a global reordering of trade relationships—as a major destabilizing force.
“Remaking 80 years of economic, geopolitical, and domestic governmental order—post-WWII bedrocks—in 80 days is messy business,” Emanuel added. “Doing it with the ‘sledgehammer’ of a larger tariff than 1930’s Smoot-Hawley was bound to cause turmoil.”
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Investors and analysts watching the volatility unfold can monitor how sector and company weightings evolve using the S&P 500 Historical Components API.
This API enables access to:
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Real-time and historical composition of the S&P 500
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Changes in index constituents
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Sector allocations over time
In fast-moving markets, understanding which companies and sectors are driving or dragging index performance is crucial—especially as earnings forecasts shift and monetary policy expectations remain fluid.
Market-Wide Recalibration
Evercore’s downgrade follows a growing chorus of lowered expectations from major Wall Street firms. Goldman Sachs, Wells Fargo, UBS, and RBC all trimmed their S&P 500 targets last week, reflecting a broader reassessment of economic resilience amid the growing likelihood of a policy-induced slowdown.
While earnings season is just beginning, early indicators suggest that tariff-induced inflation and global demand contraction could weigh heavily on Q2 and Q3 results.
Final Take
Julian Emanuel’s shift may not signal doom, but it certainly signals caution. With rising volatility, geopolitical friction, and softening fundamentals, markets appear headed for a more turbulent path.
Use the S&P 500 Historical Components API to stay informed on the underlying shifts within the index that may shape its next move.
