Everybody wants to maintain their bullish outlook on U.S. stocks because after all, being bearish on U.S. equities hasn’t exactly paid off this year.

Thanks in no small part (and arguably thanks entirely) to the tax cuts boosting corporate bottom lines and catalyzing a buyback binge, U.S. benchmarks have managed to shake off all manner of ostensibly bearish news and developments including, but by no means limited to, i) the largest one-day VIX spike in history and a subsequent forced unwind from systematic strats, ii) regulatory jitters in tech, iii) trade wars, iv) a brutal unwind in the BTP market, v) the collapse of the Turkish lira, vi) bear markets in EM equities, European financials, European autos, Chinese stocks and copper.

Through it all, U.S. stocks managed to push to new highs late last month, prompting some on the sell-side to push up their year-end SPX targets…

(SPX versus Wall Street consensus / Bloomberg)

… and leaving the buy-side in the dust.

(Hedge funds fall behind and are forced to “grab” for exposure in August / Bloomberg)

You can understand why folks are reluctant to turn bearish. Still, the risks are myriad and even if you can get past the ongoing tumult in EM and the specter of more quantitative tightening as the Fed’s balance sheet rundown continues, the ECB tapers to €15 billion/month on the way to zero by year-end, and the BoJ’s halting efforts to start down the (long) path to normalization, you’re still left to ponder the U.S midterms and the possibility of more escalations in the trade wars.

As far as the midterms are concerned, it’s entirely possible that the House flips to Democrats, triggering a series of investigations that stymies Trump’s policy platform and leads to outright gridlock in D.C. As far as BofAML is concerned, that’s not the worst thing in the world for equities, but as we never tire of reminding you, these are unprecedented times for U.S. politics and there’s really no telling what’s going to happen on the legal front for the President going forward.