Goldman calls 8,000 while Burry bets on AI crash

Goldman Raises Its Target. Burry Doubles His Short.

Futures are modestly green this morning. The S&P 500 closed at a fresh record yesterday of 7,519.12. And within forty-eight hours, two of Wall Street's most closely-watched calls came down pointing in opposite directions.

Goldman Sachs raised its year-end S&P 500 target to 8,000, up from 7,600. The note cited continued AI infrastructure spending, easing geopolitical tensions, and earnings momentum. From yesterday's close, that implies roughly another six percent of upside between here and December.

Michael Burry, on the other side, used his Substack this past weekend to lay out his most specific bearish case yet. He titled the piece "The Heretic's Guide to AI's Stars Part III: Tracepalooza and the Bezzle." He compared current semiconductor index gains to the period immediately before the March 2000 collapse. He disclosed January 2027 put options on the iShares SOXX ETF, positioned for roughly a thirty percent decline. The Shiller CAPE sits at 40.1, near levels seen only at the 2000 dot-com peak.

Both have track records. Burry called 2008 housing and was famously early but ultimately right. He also called the market a sell in 2023 and has been bearish on Nvidia for over a year, while the stock continued to climb. Goldman's S&P targets have been right more often than wrong, but the pattern of sell-side desks raising year-end targets in the back third of a year tends to coincide with extended markets, not new beginnings.

Two smart people, two opposite bets. The question for a thoughtful investor is not which one is right. The question is which mistake is more expensive in your portfolio.

Yesterday's Consumer Confidence print was a small clue worth thinking about. The headline of 93.1 beat the consensus of 92.0, which the tape read as a green light. Underneath, the Present Situation Index fell 3.2 points. Two-thirds of U.S. consumers told the survey they are cutting back on spending due to rising prices. Income expectations weakened. The Expectations Index has now been below the 80-level historically associated with recession warnings since February 2025. That split-screen... a beating headline paired with a fraying consumer underneath... is the kind of reading extended markets routinely ignore. Until they don't.

This morning brings additional crosscurrents. U.S. forces carried out what officials described as "self-defense" strikes in southern Iran during the ongoing ceasefire. WTI crude fell roughly four percent overnight; Brent rose nearly three percent. That divergence is unusual and worth watching.

What to watch this morning

Before the open. Bath & Body Works, Dick's Sporting Goods, Manchester United, and Abercrombie & Fitch report. Dick's and Abercrombie are useful reads on the discretionary consumer at different income tiers. Listen to the guidance language, not the headline beat.

10:00 a.m. ET. New Home Sales for April and the Richmond Fed Manufacturing Survey. New Home Sales has been running near a seven-month low, with mortgage rates still pressuring affordability.

10:30 a.m. ET. Dallas Fed Texas Retail Outlook Survey. Regional data, but a useful tell on whether the "consumers cutting back" theme from the Conference Board print shows up in retail-specific surveys.

On the scanner. SOXX (the semiconductor ETF Burry is short, watch for any change in character), NVDA (still the index's lead horse), DKS and ANF (post-earnings reaction as a real-time read on the consumer), XLE and front-month crude (do southern Iran strikes put a floor under oil despite the overnight softness), GLD (gold as the safety bid), and the 10-year yield (where it settles after the holiday-week reset).

The market is not wrong to celebrate record highs. It is also not wrong for thoughtful investors to ask what those highs are pricing in. Goldman's target says more upside. Burry's options chain says the unwind is coming. Both can look prescient for a while. Only one will look prescient at the end.

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