The most optimistic voice on Wall Street entering 2025 has recalibrated his expectations. John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, had set the Street’s most aggressive target for the S&P 500—7,100—implying a 20% rally for U.S. equities.
Amid escalating geopolitical tension and a sweeping new round of tariffs under President Donald Trump’s revived trade strategy, Stoltzfus has gone back to the drawing board. His revised target of 5,950 signals a much more modest outlook. For the market to end the year at that level, it would still require a 12% gain from current prices, which would barely generate a 1% annual return.
Stoltzfus concedes that when Trump’s new tariff policies were announced, they appeared far more aggressive than anticipated. This changed the fundamental investment calculus almost overnight. “It all looked a lot harsher than we had expected,” he said, acknowledging that hitting the initial 7,100 target had become “highly unlikely.”
In Stoltzfus’ revised framework, simply breaking even for the year would be considered a favorable outcome. That recalibration isn’t driven by a lack of confidence in corporate fundamentals or macroeconomic health, but rather by the market’s acute sensitivity to geopolitical volatility and shifting trade dynamics.
Despite the macro noise, Stoltzfus remains skeptical of the increasingly vocal recession camp. While some strategists warn of a looming downturn, he sees that outlook as overly pessimistic and misaligned with underlying data. “The problem is not so much where we’re headed, but as to getting over where we are now,” he said.
His view is grounded in precedent. He points to past predictions that failed to materialize—specifically those that pulled markets into bear territory in 2022. “That recession never came,” he said. “And the same bearish call didn’t work in ’23 or in early ’24, despite a slowing economy.” Stoltzfus believes current fears may once again prove misplaced.
He also finds support in the data. Recent labor market strength and a cooling inflation trend underscore his case. Last month’s payroll report and inflation metrics both surprised to the upside, showing that consumers are still spending and inflation is decelerating. However, these backward-looking figures don’t yet reflect the likely drag from newly enacted tariffs, which are only now beginning to filter into corporate and consumer behavior.
Early indications suggest that consumer confidence has already taken a hit. Sentiment surveys show declining optimism, and forward-looking earnings guidance from some companies reflects caution. That’s not unexpected, says Stoltzfus, who attributes the souring mood to persistent inflation concerns.
Tariffs will likely apply upward pressure on prices in the near term, but Stoltzfus believes the competitive dynamics in key consumer-facing sectors—such as restaurants and grocery stores—could help cap the pace of price increases. “Increased competition in these industries could be a mitigating factor,” he said.
As for earnings, Stoltzfus expects S&P 500 companies to deliver mid-single-digit profit growth in aggregate this year. While that’s far from spectacular, it would represent a resilient performance in the face of persistent policy uncertainty, tightening financial conditions, and rising input costs.
For investors, Stoltzfus believes the key will be selectivity. High-quality names with durable earnings streams, domestic production footprints, and service-based models are likely to outperform. “Not all earnings are tied to imports,” he said. “A significant portion comes from services and products produced and sold here in the U.S.”
For advisors helping clients navigate this volatile period, Stoltzfus’ comments underscore the importance of avoiding overly simplistic recession narratives. While risk management remains paramount, his outlook suggests that the broader economic and corporate environment may remain more durable than consensus estimates suggest—provided inflation expectations remain anchored and tariff impacts are managed effectively by companies.
Perhaps most distinctively, Stoltzfus stands apart from peers in his assessment of the Trump administration’s trade overhaul. While many market participants view the latest round of tariffs as an unforced policy error, Stoltzfus offers a contrarian view.
He argues that markets have fundamentally misunderstood the strategic intent behind the president’s actions. Rather than purely punitive measures, Stoltzfus frames the tariffs as part of a larger renegotiation effort aimed at improving long-term terms of trade for U.S. companies. That view places him in rare company among institutional strategists, many of whom see the trade policy reset as a direct threat to global supply chains, consumer spending, and margin sustainability.
Stoltzfus acknowledges that the short-term effects of tariffs can be disorienting and even painful. But in his view, the long-term upside of rebalancing trade relationships and restoring manufacturing competitiveness outweighs the transitional costs. This stance may be unpopular in investment circles focused on near-term earnings visibility, but Stoltzfus is not new to taking out-of-consensus positions.
His belief is that a recalibrated global trade framework—if managed with discipline—could ultimately restore pricing power for American firms, reduce dependency on volatile overseas suppliers, and reinvigorate domestic job creation in key sectors.
Still, Stoltzfus is not dismissive of the risks. He is aware that investor confidence is highly sensitive to uncertainty, and he acknowledges that the current policy trajectory—particularly if miscommunicated or implemented too abruptly—could destabilize fragile capital markets. “Markets like clarity,” he said. “And right now, clarity is in short supply.”
For wealth advisors, the key takeaway from Stoltzfus’ updated thesis is that selectivity and discipline remain central to portfolio strategy in 2025. While the broader indexes may struggle under the weight of macro volatility and tariff-induced input pressures, opportunities still exist in U.S.-centric business models, service-driven firms, and companies with strong balance sheets and proven pricing power. In other words, this is a market for fundamentalists—not momentum chasers.
He also urges advisors to resist the temptation of binary thinking. “It’s not a question of boom or bust,” Stoltzfus said. “There’s a lot of space between full-throttle growth and a deep recession. Navigating that middle ground is what smart investing is about.”
The shift from Stoltzfus’ earlier 7,100 call to a more conservative 5,950 target reflects not just a change in forecast, but a reweighting of time horizons. His core thesis—that U.S. corporations remain fundamentally strong and capable of adapting to policy headwinds—has not changed.
What has shifted is the expected timing and trajectory of market recovery. As tariffs ripple through earnings models, corporate guidance, and consumer psychology, the road to meaningful equity appreciation may now be slower, more selective, and defined by earnings quality over index breadth.
Ultimately, Stoltzfus’ updated market call serves as a reminder to advisors and asset allocators that macro events, even those with disruptive optics, should not dictate long-term strategy in isolation. While trade policy risk has clearly altered the near-term investment environment, it has not upended the foundational drivers of U.S. economic resilience.
Business investment, labor market participation, consumer spending, and service-sector strength remain intact. Those forces, Stoltzfus believes, will reassert themselves once the market digests the policy shock.
In sum, Stoltzfus is no longer the Street’s most aggressive bull—but he remains a determined optimist. For wealth advisors guiding clients through a minefield of headlines, his perspective offers both caution and conviction. There is risk in the system, yes—but there is also resilience. And that, more than any year-end index target, is what long-term investors should be paying attention to.
