S&P 500 tops 7,000 for the first time ever

• It's replicated by numerous mutual funds and exchange-traded funds and is considered the benchmark that investors, both professional and casual, measure their performance against.

Driving the news: Stocks opened higher on Wednesday, pushing the S&P 500 up 0.3% in the first few minutes of trading, to top 7,000 before slipping back below that level.

The big picture: The S&P 500 ended 2025 with a gain of 16.4%, its third consecutive year of double-digit returns.

• So far this year, the S&P 500 is up more than 2%.
• Investors are focusing on the earnings reports coming out this week and shrugging off worries over President Trump's tariff threats and the Federal Reserve.
• The S&P 500 crossed 6,000 for the first time in November 2024.

Zoom in: The S&P 500 is so influential because it is seen as a proxy for corporate America, with its American companies representing some 80% of the entire capitalization of the U.S. stock market.

• It's not an average, but an index weighted by the market caps of its component companies.
• When the expanded 500 version of the index launched on March 4, 1957, it was "groundbreaking not only for its breadth, but also because it could be calculated and distributed on an hourly basis," per its overseer, S&P Dow Jones Indices.

What's next: Wall Street strategists are largely very bullish on stocks for 2026, pointing to lower interest rates and the stimulative effects of the tax cuts in the One Big, Beautiful Bill Act.

• AI will also continue to be a driver, particularly for non-tech companies that have found productivity gains by using the new technology.
• Back in October, analysts at Evercore ISI wrote that AI adoption, among other factors, could propel the S&P 500 to 9,000.