Fundstrat’s Tom Lee says the S&P 500 is not topping out, arguing that valuations are set to expand rather than contract. Speaking on CNBC, he pushed back on claims that this is the most expensive market ever and said stocks deserve a higher price to earnings multiple.

Lee points to accelerating earnings growth and improving economic data. The ISM Manufacturing Index has moved back above 50 after a multi year contraction, and he expects a dovish Federal Reserve under new leadership. In his view, that combination supports multiple expansion.

He compares stocks to gold, which has surged to a roughly $35 trillion market cap after being revalued as a store of wealth. If gold can command a premium, Lee argues equities can as well, especially after navigating COVID, tariffs and repeated shocks while continuing to grow profits.

Lee also dismissed fears that AI will hurt markets. He sees software disruption as a source of cost savings and productivity gains, not a drag on earnings.

Prediction markets remain split, with gold favored over the S&P 500 in 2026. Still, Lee believes bull markets do not die of old age, and with steady inflation and solid jobs data, he sees further upside ahead.