History Predicts S&P 500 Surge in 2026: Buy These 2 Stocks Now

The S&P 500 has displayed strong growth trends in 2025, and experts predict this surge will continue into 2026. Recent data indicates that this includes significant contributions from leading technology firms that have capitalized on advancements in artificial intelligence (AI).

Market Trends and Projections

The bull market of the S&P 500 celebrated its three-year milestone in October 2025. Ryan Detrick, chief market strategist at Carson Group, noted that historically, bull markets lasting over three years often extend to an average of eight years. This optimism is bolstered by impressive earnings growth within the tech sector.

HSBC analysts predict that the S&P 500 index may reach 7,500, driven by increasing investments in AI infrastructure. The tech-heavy Nasdaq Composite index has already demonstrated a robust performance, recording a 22% increase in 2025.

Key Tech Stocks to Consider

Investors are looking closely at two tech companies that have exhibited outstanding growth this year, making them strong candidates for investment in 2026.

• 1. Advanced Micro Devices (AMD)

  AMD shares have soared by 81% in 2025, greatly outperforming the broader PHLX Semiconductor Sector index, which saw 46% gains. The company’s success stems from its increasing influence in the AI data center market, where demand for its GPUs and processors remains strong.

  Key metrics include:

  • Current Price: $210.78
  • Market Cap: $343 Billion
  • Gross Margin: 44.33%

  Contracts with major firms like OpenAI, Oracle, and Microsoft further underscore AMD’s potential. The company anticipates over 60% annual growth in its data center revenue over the next three to five years. Additionally, AMD’s client processor revenue saw a 46% increase year-over-year in Q3, reaching a record $2.8 billion.

• 2. Alphabet Inc. (GOOGL)

  Alphabet’s stock has risen by 67% as of late 2025. This growth is largely attributed to its investments in AI technologies that have enhanced its search and cloud offerings. The company reported a 16% year-over-year increase in revenue for the last quarter, totaling $102.3 billion.

  Key figures include:

  • Current Price: $310.52
  • Market Cap: $3.7 Trillion
  • Gross Margin: 59.18%
  • Dividend Yield: 0.27%

  Alphabet’s expansion in both search and cloud computing, driven by tools like the Gemini app and AI search options, has shown significant user engagement, with Google AI Search used by 75 million daily users. The company’s cloud business is projected to grow robustly, bolstered by an impressive $155 billion backlog.

Conclusion

As the S&P 500 is poised for continued growth in 2026, investing in tech stocks like AMD and Alphabet presents an appealing opportunity. Both companies are well-positioned to leverage advancements in AI and maintain their upward trajectory. With attractive forward earnings multiples, they offer potential for significant returns in the upcoming year.