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The U.S. stock market has climbed this year even with the S&P 500’s technology sector posting losses, in a positive sign of the broadening rally in early 2026.
While there has been a lot of investor fear around the U.S. stock market’s historically high valuation as the S&P 500
SPX trades around record highs, valuation alone doesn’t impact the next year’s returns, said JP Coviello, head of portfolio strategy at Citi Wealth, in a phone interview Thursday. The S&P 500’s valuation is justified by its composition today, which is heavily weighted in Big Tech companies with “tremendous” profit margins and earnings growth, he said.
