Strategists said they expect solid corporate earnings growth to continue to support gains in equities, and they see a possible boost to the economy if Trump, who took office on January 20, goes ahead with his pro-growth agenda for tax cuts and deregulation.
But they say tariffs threaten to add inflationary pressures at a time when the Federal Reserve has paused its rate-cutting cycle.
"The economy is growing, inflation has been sticky but it's much lower than it was just six months or a year ago, and corporate profits are growing," said Anthony Saglimbene, chief market strategist at Ameriprise Financial in Troy, Michigan, which has a 6,500 "base case" year-end forecast for the S&P 500.