S&P 500 to Hit 8,000? Tom Lee Says Ethereum Could Lead the Next Rally

Fundstrat’s Tom Lee expects the S&P 500to climb toward 7,900-8,000 by the end of August, with the strategist arguing that strong earnings, improving sentiment and continued AI spending could fuel another leg higher.

Lee also identified Ethereum as one of the assets that could lead the next move alongside the Magnificent Seven and software stocks.

Tom Lee Sees Another Leg Higher for the S&P 500

Lee’s bullish argument rests largely on earnings and investor positioning.

Speaking on CNBC, the Fundstrat head of research argued that a recent deleveraging episode forced investors to raise cash while pushing sentiment toward excessively bearish levels. With corporate results continuing to beat expectations, that cash could now return to risk assets.

Lee said current-quarter earnings are running more than $15 above the estimates analysts had at the beginning of the reporting period. Expectations for 2027 have also moved higher, with earnings estimates approaching 410 and potentially reaching around 425 later in the season.

AI investment remains another major part of the thesis. Even after volatility in semiconductor and memory shares, Lee expects the broader technology spending cycle to remain supportive for corporate profits.

An S&P 500 move toward 8,000 would require only a few additional percentage points of upside from current levels. His latest call follows similarly optimistic equity forecasts made over the past year.

Why Lee Put Ethereum Beside Big Tech

The more unusual part of Lee’s outlook was Ethereum.

He identified the Magnificent Seven, software stocks and ETH as potential leaders as markets recover from the latest correction. Ethereum is not part of the S&P 500, so the comment appears to be a broader risk-asset call rather than a claim that ETH itself will drive the index toward 8,000.

There are also signs supporting a stronger crypto backdrop. U.S. spot Ethereum ETFs have recently returned to net inflows, while large holders have continued accumulating ETH during periods of market weakness.

That gives Lee’s Ethereum call a different character from his semiconductor thesis. Rather than simply extending the AI trade, he is effectively betting that improving risk appetite could spread beyond equities and into crypto.

Fresh Jobs Data Add a New Variable

One important piece of information arrived after Lee’s comments.

The July U.S. employment report released Friday showed nonfarm payrolls falling by 23,000, while the unemployment rate edged down from 4.2% to 4.1%. May and June payroll growth was also revised lower by a combined 103,000 jobs.

The data introduce a new variable into the S&P 500 outlook. A softer labor market could eventually reduce pressure on interest rates, which may support valuations, but a sustained deterioration in hiring would also raise questions about economic growth and future earnings.

For now, Lee is betting that earnings strength, AI investment and renewed risk appetite will outweigh those concerns. Reaching 8,000 by the end of August would put that thesis to a relatively quick test, while his decision to place Ethereum alongside software and the Magnificent Seven makes the call broader than a straightforward S&P 500 forecast.