Recession is the most feared word in the financial sector, and murmurs of a downturn, like every year, are also doing the rounds in 2026. Doomsday calls of a historic crash are hitting headlines almost every week, but the US stock market is proving otherwise. The Dow Jones Industrial Average reached an all-time high of 50,219, making leading equities soar in the charts.
The predictions of a recession in 2026 follow the US’s imposition of tariffs on every country, contributing to the ongoing trade wars. However, the US stock market is unfazed by the foreign policies, and investors sound more confident in the economic sector. Traders are more confident in the market than they were under the Biden administration, where the markets had stabilized.
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2026 Recession Odds
Ed Yardeni, the President of Yardeni Research, spoke to CNN and remains extremely bullish on the US stock market’s prospects. The strategist predicted that the S&P 500 index would defy all odds and reach a high of 7,700 this year. The index is now flirting with the 7,000 mark and is expected to reach the milestone this week. It closed Monday’s trading session at a high of 6,964. Yardeni explained that the odds of a recession in 2026 are much lower than those of the previous years.
“Our year-end 2026 target for the S&P 500 assumes that the economy and earnings will remain resilient,” said Yardeni. Speaking about a recession, “Our odds of a severe correction or a bear market, triggered by either recession fears or an actual recession, remain low at 20%.” That’s the lowest prediction in five years, and the US market looks more roaring than before.
In conclusion, the odds of a severe recession in 2026 are only 20%. The US stock market is expected to grow further and bring profits to investors. Even tech stocks, which faced a $1 trillion rout on Friday, ended up trading in the green on Monday.