Nuveen CIO Predicts S&P 500 Rally Through Year-End, Cites Earnings and AI Growth

Nuveen CIO Saira Malik expects the S&P 500 to continue rallying into year-end, driven by strong corporate earnings and enthusiasm around AI. She notes that the fourth quarter is historically a strong period for equities and that valuations have been justified by earnings growth. Malik suggests investors consider AI-focused sectors outside of chipmakers, such as data center companies, to mitigate concerns about valuations.

Palantir Technologies (PLTR) has experienced a remarkable surge in its stock price in 2025, making it one of the top-performing S&P 500 stocks for the second consecutive year. As of October 6, the stock has risen by approximately 130-140% year-to-date, an impressive feat considering its 360% gain over the past 12 months and a staggering 1,800% increase since its 2020 IPO Palantir’s AI-Fueled Surge Faces Army Security Scare – October 2025 Stock Report^[1].

The company's Q2 2025 earnings report was a standout, with revenue hitting $1.0 billion for the first time, marking a 48% year-over-year increase. This growth was driven by robust demand from both government and commercial sectors. Palantir's management has raised its full-year revenue guidance to $4.14-$4.15 billion, reflecting the company's strong momentum .

Major contracts have been a significant driver of Palantir's growth. In July 2025, the U.S. Army awarded Palantir a $10 billion, 10-year contract, consolidating dozens of projects into a single enterprise deal. Additionally, the U.K. government announced a £1.5 billion partnership to deploy Palantir's AI technology across British military operations .

However, the stock faced temporary volatility in late September when an internal U.S. Army memo raised concerns about security flaws in a new battlefield network developed by Palantir and Anduril. The memo labeled the system "very high risk," citing vulnerabilities like lack of access controls and auditing. Palantir's stock tumbled by approximately 7.5% following the report, but the company quickly reassured investors that the issues had been addressed as part of the normal testing process .

Despite this setback, Palantir has continued to expand its reach beyond defense. In October 2025, healthcare data firm OneMedNet announced it has chosen Palantir's Artificial Intelligence Platform (AIP) to power a near real-time analytics network for hospitals and researchers. This partnership aims to tap into the $868 billion AI-healthcare market by 2030 .

Analysts remain divided on Palantir's outlook. While some bulls, like Wedbush analyst Dan Ives, see the company's growth as a top pick, short-seller Andrew Left has called Palantir's valuation "absurd." Price targets vary widely, with recent 12-month targets ranging from under $100 to $215 .

Palantir's strong financial performance and growth prospects have been bolstered by its dual engines of government and commercial revenue. The company's unique positioning as an "AI arms dealer" to both militaries and corporations has fueled its stock surge and a market capitalization of over $400 billion. However, investors are paying a rich price for this growth, with Palantir trading at valuation multiples far above peers .

Nuveen CIO Saira Malik expects the S&P 500 to continue rallying into year-end, driven by strong corporate earnings and enthusiasm around AI. She suggests investors consider AI-focused sectors outside of chipmakers, such as data center companies, to mitigate concerns about valuations .