President Donald Trump says the stock market is headed higher. But if you want to know what the market actually thinks, you might be better off checking the prediction markets, where the odds tell a slightly more cautious story.
On Kalshi, bettors currently assign a 51.8% probability that the S&P 500 will close above 8,000 by the end of the year. That's down from a yearly peak of 79% last month, but still well above the 19% recorded at the start of 2026. So, the market is still leaning bullish, just not as exuberantly as it was a few weeks ago.
The odds of the index hitting 8,200 or higher have also cooled, standing at 27% compared to 54% in mid-August. And the chance of breaching 8,400? That's now nearly 16%.
Interestingly, the prediction markets also show a 17% chance that the S&P 500 will close above 8,000 on Dec. 31, versus a 13% chance it lands between 7,600 and 7,799.99. So, the most likely scenario, according to these bettors, is a finish somewhere in that upper range, but not necessarily a record-shattering rally.
For context, the S&P 500 is the go-to barometer for the health of the U.S. stock market, tracking 500 of the largest publicly traded companies in the country. Year to date, it's up 12%, though the pace has slowed recently, with a 0.87% gain over the past month. The index hit a record close of 7,798.99 in mid-August, and on Wednesday it rose 0.46% to close at 7,666.60.
Wall Street is taking notice of the momentum. JPMorgan raised its year-end target for the S&P 500 to 8,000 from 7,800 last month, citing a strong earnings season and the ongoing AI-driven rally.
Trump, for his part, remains confident. He recently said that "the stock market will go up" despite the ongoing war in Iran, adding that the market has kept hitting new records and would likely be even higher if not for the conflict.
But here's the twist: while Trump is talking up the market, his political standing is slipping. His approval ratings have dipped sharply in 2026, with some polls putting his overall approval as low as 32% to 34%. And surveys from August show that Americans now trust Democrats more than Republicans to manage the economy.
So, what does this all mean for investors? The prediction markets are essentially saying that an 8,000 close is more likely than not, but it's not a slam dunk. There's a lot of uncertainty out there, from the war in Iran to domestic politics. And while Trump's optimism is notable, the markets are pricing in a more nuanced reality.
As always, it's worth remembering that prediction markets aren't crystal balls. They're just a bunch of people putting their money where their mouths are. But sometimes, that's the most honest signal you can get.
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Image via Shutterstock/ Joey Sussman
