The S&P 500 is up an impressive 16% over the past year. More and more UK investors are adding US stocks to their portfolios, taking advantage of the strong AI and tech exposure they offer. Yet, according to the experts, the party for 2026 might not be over just yet!

Taking a look at the figures

Experts and bank analysts contribute to a year-end forecast for the S&P 500. This gets updated regularly, meaning that forecasters can change their view as the year unfolds. At the moment, the mean is 7,857 points. Contrast this with the current price of 7,418, which represents just under a 6% potential return through to the end of the year.

Within the forecasts, some of the large banks, including UBS and Citi are looking for 8,100 points. The top estimate is 8,250 points, with the lowest at 7,100 points. Therefore, there’s a definite skew towards a higher finish than a fallback towards the lower 7,000s. In theory, if £3,200 was invested now, it could turn into £3,392 by the end of the year.

Whenever I look at analyst forecasts, I have to take them with a pinch of salt. Even though these are smart people, it doesn’t mean they are always right. So although I can get a steer from their forecasts, I still need to consider my personal view before making any investment decisions.

Being selective

Although I agree the index will likely finish the year higher than where we are now, I think there are individual sectors and stocks that could easily outperform the 6% target.

For example, elevated oil prices should trigger higher inflation in the US this summer, forcing US Federal Reserve members to hike interest rates. This should be good for banking stocks. With continued high volatility in financial markets and higher M&A activity, trading desks and investment bank divisions also stand to reap higher rewards this year.

To that end, JP Morgan (NYSE:JPM) could be a prime beneficiary. The stock is up 19% in the past year. Higher rates allow the bank to earn more on loans than it pays out on deposits, boosting net interest income. Management recently increased its full-year net interest income guidance to a whopping $105.5bn, reflecting the view that this area could act as a major driver for the overall company.

The pure size of the bank is another reason why I think it can do well in an environment where financial services do well overall. Over recent years, it has steadily increased market share across deposits, wealth management, and corporate banking. It now has over $5trn in assets and an enormous retail deposit base, giving itself a competitive advantage that’s increasingly difficult for rivals to replicate.

Of course, the company could struggle if high inflation leads to lower economic activity, with elevated interest rates triggering an economic shock. This could see loan defaults increase, which would be a headache for JP Morgan. But even with this risk, I think it’s an attractive stock to consider for investors looking for more exposure to this sector.

Should you invest £5,000 in JPMorgan Chase right now?

When investing expert Mark Rogers and his team have a stock tip, it can pay to listen. After all, the flagship Twelfth Magpie Share Advisor newsletter he has run for nearly a decade has provided thousands of paying members with top stock recommendations from the UK and US markets.

And right now, Mark thinks there are 6 standout stocks that investors should consider buying. Want to see if JPMorgan Chase made the list?

Jon Smith does not hold any positions in the companies mentioned.