RBC Capital Markets strategists, led by Lori Calvasina, warn that the S&P 500 could decline by 5% to 10% in the coming weeks. The firm published this assessment on September 9, 2026, citing seasonal weakness and the upcoming November 3 midterm elections as primary drivers of potential volatility.
Historical data shows that September has seen declines in five of the last ten years. Additionally, betting markets indicate a higher probability of a Democratic sweep, which RBC views as less favorable for equities in the short term, especially for the technology and AI sectors facing potential regulatory backlash.
Geopolitical tensions related to the unresolved Iran conflict are also impacting consumer sentiment and corporate earnings expectations. RBC describes the potential 5-10% drawdown as a routine correction that would not cause lasting structural damage to the market.
Despite short-term risks, the firm maintains a 12-month price target for the S&P 500 at 8,150. Based on the closing price from September 8, 2026, this target suggests a potential upside of approximately 6% over the next year.
The bullish long-term outlook depends on the absence of major recession surprises or sharp interest rate hikes. RBC notes that a hawkish surprise from the Federal Reserve could push market declines beyond the current 10% threshold.