LIVE MARKETS-Wells bumps up Russell 2000 target

ReutersFeb 4, 2026 7:07 PM

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WELLS BUMPS UP RUSSELL 2000 TARGET

Wells Fargo Investment Institute has bumped up its year-end forecast on the small-cap Russell 2000 index .RUT to a range of 2,700-2,900 from 2,500-2,700 previously, while it has left its forecast for the S&P 500 .SPX unchanged.

Even with a selloff in the market on Wednesday, the Russell 2000 index is up about 5% for the year to date and is outperforming the S&P 500, which is now nearly flat for the year. Wells is keeping its year-end target on the S&P 500 at 7,400-7,600.

The Russell 2000 is currently at 2,593, while the S&P 500 is at 6,846 on Wednesday afternoon.

The Russell target change is part of other target revisions from the firm, also released on Wednesday, with Wells also raising its 2026 U.S. GDP growth forecast and lowering its fourth-quarter U.S. unemployment rate estimate "to account for early 2026 economic momentum." It also raised its 2026 year-end target on gold.

Lower borrowing costs and a stronger economy should "justify a higher price-to-earnings multiple for the credit-dependent" small-cap equities group, Wells says in the note. However, the firm says it is keeping an "unfavorable" rating on the group, noting: "Our caution remains that the many non-earning companies in the Russell 2000 Index benchmark could weigh more on this asset class than on others..."

Wells has not changed its Russell 2000 EPS target.

(Caroline Valetkevitch)

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