Wall Street Slashes S&P 500 Forecasts as Tariff Turmoil Clouds 2025 Outlook

Wall Street’s confidence in the S&P 500 is rapidly fading as President Trump’s turbulent tariff policies shake investor sentiment and scramble market projections.

What started the year as a relatively unified outlook has now splintered, with major firms offering drastically divergent views on where stocks will land by December.

Recent market whiplash was triggered when Trump rolled out sweeping tariffs—only to suspend most of them 90 days later. That abrupt policy reversal sparked the index’s strongest rally since 2008, mere days after it endured its steepest drop in five years. But the relief was short-lived.

Uncertainty around the administration’s trade direction has made forecasting a nightmare. Economic confidence is faltering across the board—from consumers to corporations to the trading floor. As a result, big-name institutions are scrambling to revise their predictions. JPMorgan took the most aggressive stance, slashing its year-end S&P 500 forecast from 6,500 to 5,200. Bank of America and Evercore also trimmed their targets by over 1,000 points each, while Oppenheimer pulled back its projection by more than 16%.

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This flurry of downgrades has widened the gap between the most bullish and bearish outlooks dramatically. At the beginning of 2025, year-end estimates ranged just 600 points apart. Now, the spread has ballooned to 1,800. Even when excluding firms that haven’t yet updated their numbers, the forecast range is still 50% wider than it was a few months ago.

Earlier in the year, the average prediction was a modest gain, pointing to a continued three-year winning streak. But new revisions tell a less optimistic story. The updated consensus among firms that have adjusted their targets now places the index below where it started in 2025—reflecting a shift in sentiment that’s hard to ignore.

Alexander Stefanov