Despite worries that the economy could be heading into the late stage of the economic cycle, Wall Street bull Tony Dwyer of Canaccord Genuity is doubling down on his optimistic call that the S&P 500 Index will surge even more this year.

The market strategist is predicting the S&P 500 will increase more than 12% from current levels by the end of 2018. In a research note to clients covered by Bloomberg, Dwyer said the upside in the S&P 500 will be driven by a strong economy and corporate earnings growth that has been up double digits in the first two quarters of 2018. He predicts the gauge will top 3,200 by year end. Currently, the S&P 500 Index is trading at 2,841.96, down 11.62 or 0.41%. (See also: 4 Blue Chips Seen Breaking Out as S&P Hits Record.)

Buy on the Dip

“Any pause in the upside should be considered opportunity,” Dwyer wrote in the research note, according to Bloomberg. “There is no doubt the unpredictable news backdrop of a potential trade war with China and a rise back to 3 percent in the 10-year U.S. Treasury yield can cause increased volatility, but the fundamental backdrop commands using it as an opportunity to add risk.”

At the start of the year, the S&P 500 Index gained to 2,872.87. But a mid-February correction in the stock market over fears the economy was growing too quickly and thus the Federal Reserve would raise interest rates more than expected, resulted in a 10% correction in the index. (See also: Where to Find Bargain Stocks in the S&P 500.)

Corporate Earnings, Economy Continue To Be Drivers

The way Dwyer sees it, profits at publicly traded companies continue to expand at the same time consumer and business confidence is increasing. That comes even amid concerns that growth may be hit by the tariffs put in place by President Donald Trump and rising trade tensions between the U.S. and China. 

"The second quarter annualized gross domestic product (GDP) and final sales report made clear that both businesses and consumers are in the spending mood following the passage of the Tax Cuts and Jobs Act of 2017," Dwyer wrote in the note, which was also covered by CNBC. "Second-quarter SPX operating earnings per share now look to be up 24 percent, with 79 percent of those having reported beating expectations. Confirming the stronger willingness of businesses and consumers to spend, SPX top-line growth should be up 9.4 percent."

Dwyer, who is the most bullish market strategist tracked by Bloomberg and CNBC, is also optimistic about next year, saying the rally in stocks should ensue until the end of 2019. At that point, the S&P 500 Index could be trading around 3,360, he estimated.