S&P 500 Forecast: Bulls Defend 7,100 as AI Earnings Face Their Show-Me Moment

Published: April 29, 2026

Key Points

• The S&P 500 is in a bullish trend, with buyers defending the 7,100 area after a recent push above 7,200.
• Durable goods orders and housing starts exceeded forecasts, supporting the U.S. growth narrative despite rising oil prices and Treasury yields.
• Upcoming earnings from major tech companies will be crucial in determining whether the index can retest 7,220 or drop back toward 7,100–7,086.

Bulls Hold the 7,100 Zone

The S&P 500 is showing resilience, bending but not breaking. Following the Federal Reserve's decision to maintain interest rates between 3.50% and 3.75%, the index experienced a controlled cooling from its recent highs. Despite several factors that could have triggered a sell-off—such as a rally in crude oil, a rise in the 10-year yield to near 4.40%, and a stronger dollar—the index has managed to hold above the critical 7,100 support level.

Growth Data Supports the Setup

Recent U.S. economic data has bolstered the bullish sentiment. Durable goods orders for April rose by 0.8%, surpassing the 0.5% forecast, indicating robust business spending. Additionally, housing starts came in at 1.502 million, exceeding the expected 1.400 million, which helps sustain the soft-landing narrative and reduces recession fears.

AI Earnings Take the Wheel

The upcoming earnings reports from major tech companies—Microsoft, Alphabet, Amazon, Meta, and Apple—are pivotal. These firms represent about 24% of the S&P 500, and their performance will likely dictate the index's next move. Investors are looking for evidence of profitability and effective capital expenditure in AI, as mere spending won't suffice. Microsoft and Apple appear well-positioned, while Alphabet and Amazon face challenges regarding infrastructure costs. Meta's situation is more complex, with potential margin pressures but a promising AI narrative for the full year.

S&P 500 Outlook

The current trend for the S&P 500 is bullish, with a positive bias. Key support levels are at 6,310 and 6,920, while resistance levels are at 7,180 and 7,450. The medium-term outlook remains constructive as long as buyers defend the 7,100 level. Strong economic data supports this growth narrative, and the Fed's stable policy environment is conducive to equity performance. The next significant movement will depend on the earnings results from the mega-cap tech companies. If they deliver strong results, the index could retest 7,220 and potentially reach 7,300. Conversely, disappointing earnings could lead to a tactical reset towards 7,100–7,086, but not necessarily a trend reversal unless that support is decisively broken.

Conclusion

The S&P 500 is at a critical juncture, with economic indicators supporting a bullish outlook. However, the upcoming earnings reports from major tech companies will be the deciding factor in whether the index can maintain its upward trajectory or face a pullback.