2026 Market Outlook: First Half Swoon With A Strong Finish

Dec. 22, 2025 10:14 AM ETSPDR® S&P 500® ETF (SPY), DIA, QQQ, IVV, VOO, IWM, SPX, SP500, NDX, DJINVDA, CSCO, INTC
Mark Bern, CFA
Investing Group

Summary

  • I expect a limited banking sector crisis in early 2026, driven by CRE loan exposure and subprime auto delinquencies, but contained by Fed intervention.
  • Fed liquidity injections and potential rate cuts should stabilize markets, with the S&P 500 (SPY) projected to end 2026 at 7600, an 11.2% gain.
  • I anticipate volatility and possible correction in tech and AI stocks but expect a strong rebound in 2H 2026, supporting QQQ and sector leadership.
  • Broader market breadth should improve as value sectors regain footing, with inflation gradually abating to around 2.3% by the end of 2026.
People silhouettes on American stock market index S P 500 - SPX

Skywalker_ll/iStock via Getty Images

Introduction

The first half of 2026 will probably bring some major economic scares and market concerns. Initially it could affect a wide swath of the market, but as the problems become better understood, the greatest impact will be more concentrated. There is a highly

Recommended For You

Create a free account to read the full article

Gain access to the world's leading investment community.

Already registered?

By creating an account using any of the options above, you agree to the Terms of Use & Privacy Policy
or

Top Stocks for 2026

Join us on January 6 as our VP of Quantitative Strategy, Steven Cress, discusses the Top 10 Stocks for 2026.

These picks are selected using the proven data-driven approach that led 2023, 2024 and 2025 picks to significantly outperform the S&P 500.* 

Subscribe to Premium for just $4.95 for your first month to attend this members-only event. 

Banner Image
Register Now

*Performance as of November 28, 2025. Past performance is no guarantee for future results. Subject to Seeking Alpha’s Events Policy as available here: https://about.seekingalpha.com/events-policy. 

About SPY ETF

SymbolLast Price% Chg
SPY
687.960.46%
Post687.68-0.04%
Chart
Combination chart with 2 data series.
The chart has 1 X axis displaying Time. Data ranges from 2025-12-18 09:30:00 to 2025-12-23 16:00:00.
The chart has 1 Y axis displaying values. Data ranges from 675.72 to 687.945.
End of interactive chart.
Expense Ratio
0.09%
Div Frequency
Quarterly
Div Rate
$7.28
Yield
1.06%
Fund AUM
$706.87B
Class AUM
$706.87B

More on SPY

Related Stocks

SymbolLast Price% Chg
QQQ
622.110.47%
Post:622.300.03%
SPY
687.960.46%
Post:687.68-0.04%
DIA
484.230.16%
Post:483.99-0.05%
IVV
690.970.46%
Post:690.62-0.05%
IWM
252.08-0.59%
Post:251.98-0.04%
VOO
632.670.47%
Post:632.38-0.05%
SP500
6,909.790.46%
NDX
25,587.830.50%
DJI
48,442.410.16%
SPX
6,911.720.03%
Chart
Line chart with 10 lines.
The chart has 1 X axis displaying Time. Data ranges from 2025-12-18 09:30:00 to 2025-12-24 00:50:00.
The chart has 1 Y axis displaying values. Data ranges from -0.88 to 2.52.
End of interactive chart.

Trending Analysis

See All Analysis »

Trending News

See All News »