BARCLAYS: S&P 500 VALUATION MAY SIGNAL TURNING POINT Barclays analysts note that with the S&P 500 trading at 22 times next-twelve-month earnings, valuation alone may not be a major obstacle for stocks. Historically, they say, once valuations cross 22x, average returns tend to improve and become less volatile — suggesting possible bear capitulation if earnings growth remains positive. They highlight past examples like 1998 and 2020, where similar valuations followed sharp sell-offs and strong recoveries. While near-term volatility is likely due to fiscal uncertainty and upcoming tariff impacts, Barclays sees limited downside risk from valuation alone, especially if earnings grow as projected (~9% in 2026). In short: despite risks, current valuations could support further market gains.