The S&P 500 crossed 1700 Thursday morning for the first time ever, marking a new intraday high. And as we enter August, stocks have posted gains now for eight out of the last nine months. It’s the kind of rally that may give some investors pause, but we talked to Savita Subramanian, the head of U.S. equity strategy at Bank of America Merrill Lynch (BAC), who thinks the market will go higher from here.

In July, Subramanian upped her year-end target for the S&P 500 (^GSPC) from 1600 to 1750, making it the second most bullish call on Wall Street (according to Business Insider).

Why?

In the accompanying video, she tells The Daily Ticker that when they initially set their S&P 500 target in late-2012, it was a pretty bullish call at the time and equities ripped right through. So in July, looking at the upside and downside risks to stocks, they simply saw more upside to go.

That upside includes expected earnings growth, positive surprises in the US economy, diminished tail risks, and a continued decline in earnings volatility, according to the BofA Merrill Lynch Global Research report.

Related: Market Top Is In, Brace for Correction: Jeff Saut

One other catalyst for the increase in conviction Subramanian notes was the interest rate market. Subramanian’s view is that we’re at the trough in interest rates and starting to see rates climb. She says normally in a phase when rates move from low to normal, it’s a great time to be in equities (it’s only when they’re really high, she says, that you want to worry and shift more into bonds, but she thinks we’re well away from that, given recent Fed guidance).

Subramanian says a collapse in corporate earnings could cause stocks to miss her target but she says so far earnings are chugging along.

“Everyone made a big deal of the market reaching a new high this year,” she tells us, “but the truth is that corporate earnings have continued to make new highs every year since 2010. So our contention is, why wouldn’t markets be reaching new highs today?”

She contends the corporate sector looks better than it has in a very long time with “pristine” balance sheets, “tons” of cash, and low levels of debt.

So who exactly is driving the equity rally? Subramanian tracks flows and says while institutions have been in and out depending on the week, the most high convinction buyers are individual investors… private clients who have been in bonds and are shifting into equities.

We recently talked to David Rosenberg, chief strategist at Gluskin Sheff, who cited the old adage that the public “gets in most at the top and least at the bottom,” as one reason stocks look a “little toppy” in the near-term.