The S&P 500 has been on a tear this year, closing at a one-year high on Friday and up more than 10% so far this year. While many analysts warned that the rally was likely to be a narrow one, driven only by a handful of major tech stocks, some Wall Street pros expected further gains in the S&P 500 . Evercore ISI’s Julian Emanuel said on CNBC’s “Squawk Box Asia” on Tuesday that he had raised his price target on the S&P 500 to 4,450 from 4,150. That’s up 4 percent from Monday’s close of 4,273.79. He said the index could hit that target by July 4. The senior managing director for equities, derivatives and quantitative strategy listed three factors he sees as “favorable for further gains.” They are: the pandemic stimulus “stock of money” that continues to provide support; better-than-expected earnings and margins, tailwinds including cost-cutting; and artificial intelligence trends. Stocks driven by the AI boom have become what they call a “momentum market,” like the dot-com-related rally from the late 1990s to 2000, Emanuel said. “Momentum extended last week into the larger S&P 500 and, importantly, the small-cap Russell 2000; this expansion has been very positive and looks set to continue,” he wrote in a note to CNBC. Brian Stutland, a portfolio manager at Equity Armor Investments, said he’s usually concerned about small gains driven by just a handful of names. However, he got some reassurance from the VIX as it fell. “If there’s a bear market, if there’s some sort of recession and disconnection in the market, we’re going to see the market go up and the volatility starts to rise,” Stutland told CNBC’s “Street Signs Asia.” “I don’t think we’ve seen hedgers enter the market yet, with institutional order flow saying ‘hey, it’s time to panic because we’re going to get a correction,'” he added. “It feels like this market can keep going, and the fact that we’re basically close to the 20% level from last year’s market lows suggests that we’re entering a bull market. We’re very close there,” said Portfolio Manager at Independent Solutions Wealth Management, however. Paul Meeks sees it differently. He sees at least a “modest correction” in the market. “Some investors have pushed stocks up based on the false premise that rates are going to come down, but I think they’ll either keep going up or they’ll hold steady in 2024. If I’m right, we might have a correction. Based on this misconception, stock prices It’s too high,” he told CNBC. The “biggest unresolved issue” is inflation, which has to come down — and a tight job market makes that “almost impossible,” he said. How to Trade Now Evercore’s Emanuel says investors should buy what he calls “momentum gurus,” or stocks with defensive prices and earnings momentum. Some examples he cited include Google, cloud security company Zscaler and airline service provider Copa Holdings. Emanuel also said small caps should “should be able to participate in the rally.” “They’re lagging again, basically back to bank stress and being less exposed as a technical index. But for us, part of the narrative around the Fed, it’s probably going to pause here … say it’s starting to come down A good time to turn a person’s toes into little caps,” he said. Small-cap stocks can be strongly correlated with the performance of regional banks. U.S. stocks, especially tech and other growth stocks, are too expensive, Meeks added. “Of course, I think AI stocks are dangerously expensive given all the hype surrounding them,” he said. However, if he were to “try to find the next (Nvidia), he’d recommend Advanced Micro Devices, Google, Meta, or Marvell Technology.” …NVDA,” he said.