In the current complex economic environment, the US stock market has shown remarkable resilience. Despite some economists warning about the potential negative impacts of Trump's tariff policies, financial giant JPMorgan remains optimistic about the US stocks. The investment bank expects the S&P 500 index to achieve a return of 7% to 9% over the next year. Three key driving factors lie behind this optimistic outlook.

Firstly, investors seem to be more focused on corporate profitability rather than signs of an economic slowdown. Since Trump initiated the first round of tariffs in April this year, economists have lowered the U.S. full-year GDP growth forecast from 2.3% to 1.5%. However, the S&P 500 index has risen by over 28% in the past four months. This indicates that investors have not been shaken by factors such as a weak labor market, slowing consumption, and inflationary pressures in manufacturing and services. Analysts at JPMorgan believe that traders are more concerned with the resilience of corporate earnings and the potential for future economic recovery, which is the main reason the market can overlook signs of macroeconomic weakness.

Secondly, the impressive performance of the current earnings season has become another catalyst for driving the stock market. So far, more than 80% of the companies in the S&P 500 index have reported their second-quarter earnings. Among them, 82% of companies exceeded earnings expectations, and 79% exceeded revenue expectations, marking the best performance since the second quarter of 2021. Wall Street had previously expected a full-year profit growth of less than 5%, but now the index is expected to reach an increase of 11%, further solidifying the bullish trend in the market.

Finally, large enterprises demonstrate a stronger ability to withstand tariff risks. Analysis by JPMorgan indicates that the market is reassessing the winners and losers under Trump's trade policies and adjusting valuations accordingly. Large enterprises, with their scale advantages and resources, are often better able to cope with and mitigate the risks posed by tariffs.

Despite economists' cautious stance on the U.S. economic outlook, the stock market's performance seems to tell a different story. Investor confidence, corporate profitability, and the adaptability of large companies collectively underpin the trends in U.S. stocks. However, market participants still need to closely monitor the developments in the global economic situation and the potential long-term impacts of trade policies.