A spike in Treasury yields and potential for a market downturn have shifted the near term perspective for US large cap stocks. Ed Yardeni reduced his expected forward P/E multiple to 18.6 from 19.8, citing concerns that higher inflation and slower growth could pressure valuations over the next 3 to 6 months. The Wall Street strategist advised investors to proceed with caution as interest rates increase.

The revised projection for the S&P 500 reflects a decrease to 7,900 from a previous forecast of 8,400. Despite the near term adjustment, Yardeni maintains a long term estimate of 10,000 for the index by 2030.