S&P 500 Nears 7,800 — Can Buybacks Keep the Rally Running?

The S&P 500 is back at record highs, recently reaching 7,757, with Goldman Sachs seeing a potential path toward 8,000.

What makes the rally interesting is the supply-demand picture.

US companies are expected to raise around $700 billion through stock issuance this year, a record amount. But corporate buybacks are running even higher, with Goldman estimating around $1.4 trillion for the full year.

In other words, companies are putting more money into buying shares than they are adding through new issuance.

AI remains a major part of the story. Around 40% of follow-on equity issuance so far this year is linked to AI-related companies, reflecting the huge amount of capital being directed toward data centres, chips and other AI infrastructure.

For US indices, that creates an unusual backdrop: valuations are high, but corporate demand for equities remains strong.

For US500, the 7,700 area is now an important reference point. Holding above it keeps the bullish trend intact, while a break back below could signal that investors are starting to lock in profits.

The bigger test is whether earnings and AI investment can continue to justify these record valuations.