Why the Bull Market Should Run Through 2027

The bull market remains fundamentally strong despite elevated valuations and seasonal election volatility risks. Two major liquidity engines—extraordinary AI capital spending (projected at ~$1 trillion by 2027) and expansionary federal deficit spending (~$1.9 trillion in 2026)—are driving robust economic growth and corporate earnings. Earnings growth is broadening beyond mega-cap tech companies, with S&P 500 companies (excluding Micron and Alphabet) showing 21.5% earnings growth. While midterm election seasonality historically creates 8.1% average drawdowns, the fundamental backdrop suggests any weakness would present buying opportunities.