Tom Lee: Expects S&P 500 Index to Rise to 7700 Points Before Correction, Strong Rebound Expected After Midterm Elections

May 29 — Tom Lee, chairman of BitMine (Ethereum’s largest treasury), told CNBC in an interview that the U.S. stock market’s steep rally since April stems largely from corporate earnings coming in above expectations. He explained the market had forecast first-quarter earnings per share (EPS) of roughly $70 for S&P 500 components, but actual EPS hit $80—an unanticipated $10 per share beat. Annualized, that adds up to a $40 earnings gain, meaning the S&P 500 theoretically has upside potential of 800 to 1,000 points. Lee stuck to his previously presented “Three-Stage Market” thesis: in the short term, the S&P 500 is projected to rise to around 7,700 points. Next, the market may enter a period of volatile consolidation ahead of October, facing pressures such as liquidity constraints from the new Federal Reserve chair, climbing energy prices, and high-value IPOs from SpaceX, OpenAI, and Anthropic. Lee noted these factors could spark a pullback comparable to a bear market, but he expects U.S. stocks to rebound after the midterm elections, calling 2027 “one of the best years for lifetime returns.” Separately, he highlighted that rising oil prices have fueled inflationary pressures, shifting the bond market away from bets on rate cuts and toward pricing in rate hikes. In this context, many sectors face greater strain, as most industries still depend on a dovish Federal Reserve for support.