S&P 500 set for new energy during earnings season
Despite the recent stock market slump that has some Wall Street pros bracing for a summer correction, respondents to Bloomberg’s Markets Live Pulse survey expect the latest round of corporate earnings to reinvigorate the S&P 500 Index.
As the reporting season ramps up, with results from headliners like Tesla Inc. and Google-parent Alphabet Inc. on deck in the coming days, nearly two-thirds of the 463 respondents to the questionnaire expect earnings to boost the US equities benchmark. About half of the participants predict that Corporate America’s scorecard will be better in the coming months than it was in the first half of the year.
At JPMorgan Chase & Co.’s trading desk, US Market Intelligence head Andrew Tyler expects positive earnings catalysts to lift the S&P 500 from its slough, particularly with analyst estimates for the so-called Magnificent Seven technology stocks — Nvidia Corp., Apple Inc., Amazon.com Inc., Meta Platforms Inc., Microsoft Corp., Tesla and Alphabet — signaling “another monster quarter,” he wrote in a note to clients. The cohort is expected to post earnings growth of roughly 30% for the second quarter from the year-ago period.
Upbeat results would be a much-needed driver for US equities, with the S&P 500 starting to go sideways after a roaring first half of the year. The stock market is facing pressure heading into a seasonally weaker period, with volatility likely to be heightened by uncertainty surrounding the US presidential election.
Stretched valuations, particularly among technology shares, have also worried investors. With that in mind, about 70% of survey respondents say they have no plans to increase their exposure to US big tech in the second half of the year.
The recent declines in
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