Tom Lee: Market Desensitized to Iran War, S&P 500 Could Reach 7700 Points

On April 28, U.S. stocks continued to strengthen on Monday, with the S&P 500 rising 0.12% to 7173.91 points, setting a new historical high. Tom Lee, founder of Fundstrat and known as ‘Wall Street’s Oracle,’ stated that the market has largely absorbed the impact of the Iran war, and the S&P 500 index is expected to rise further to 7700 points this year. In an interview with CNBC, Lee mentioned that the U.S. economy is showing ‘remarkable resilience’ and that the market has passed the stress test of this round of geopolitical conflict. He believes that even if tensions in the Middle East persist, investor sentiment has clearly become ‘desensitized.’ Lee pointed out that the three main drivers currently pushing U.S. stocks upward include: strong corporate earnings performance, with over 89% of companies exceeding profit expectations; the productivity gains from AI beginning to materialize; and the private credit market recovering faster than expected. He also noted that historical data shows that U.S. stocks often quickly price in the effects of major geopolitical wars and gradually rebound. Although the situation in the Strait of Hormuz continues to drive up oil prices, the U.S. economy currently possesses strong anti-inflation capabilities. According to his forecast, the S&P 500 index still has about 7% upside potential to reach the target of 7700 points.