Investors are expecting more gains for the U.S. stock market in 2025 after two straight standout years, fueled by a solid economy supporting corporate profits, moderating interest rates and pro-growth policies from incoming President Donald Trump.

The benchmark S&P 500 is up over 23% year to date, even with a recent speed bump, and is on pace for its second straight year of gains exceeding 20%, lifted by megacap tech stocks and excitement over the business potential of artificial intelligence.

Investors are more confident about the economy than this time a year ago, with consumers and businesses having absorbed higher interest rates and the Federal Reserve now lowering them — albeit by not as much as hoped. Corporate profits are also expected to be strong, with S&P 500 earnings projected to rise 14% in 2025, according to LSEG IBES.