S&p 500 2025 Q1 Earnings Preview: A Clearing Event Or More Uncertainty? Lseg

By December 2026, EUR/USD is expected to reach 1.20, GBP/USD 1.36 and USD/JPY 164. In Japan, the sharp rise in USD/JPY has come to a halt, but the yen still declined slightly in 2025 — highlighting the challenge for it to sustainably outperform while interest rates remain negative. Elsewhere, there could be a buy-the-dip opportunity in sterling given resilient domestic growth, an anticipated global growth upswing and a carry-friendly environment. “However, any EUR/USD gains should be moderate versus 2025 unless U.S. data materially weakens,” Chandan said. Morgan Global Research is moderately bullish on the euro — a view supported by eurozone growth and German fiscal expansion.

• We may find companies withdraw guidance altogether or widen the range of guidance provided to account for heightened uncertainty.
• Morgan is a marketing name for businesses of JPMorgan Chase & Co. and its subsidiaries and affiliates worldwide.
• Dispersion crosses sectors, themes and the individual stocks within them, and this means exciting potential to generate alpha through skilled stock selection.
• “The structural drags for GBP are not going away, and this is why we’re taking more of a tactical buy-the-dip approach rather than turning more strategically bullish,” explained James Nelligan, an FX strategist at J.P.

What’s The Overall Outlook For Global Markets In 2026?

While GDP growth has been resilient through 2025, imbalances have formed as demand has rotated toward tech capex and job gains have stalled. The global expansion is at an important juncture. Sign up for the weekly In Context newsletter, bringing market views and industry news straight to your inbox. Elsewhere, LatAm could experience strong upside thanks to outsized monetary policy stimulus and key political shifts.

Exhibit 16: S&p 500 Corrections Are Usually Good Buying Opportunities

Interestingly, currently, we see no clear signs of shortages or supply-side stress in any of the agricultural commodities except in the livestock sector and to some extent cocoa markets. We see there is a room for further robust growth in investor demand for gold too, particularly as we expect gold ownership to continue expanding into 2026 and 2027. Frontier markets, what we call frontier markets in general, particularly in local markets, places like Egypt, Nigeria, Kazakhstan, maybe we’d put Argentina in that bucket as well, also been a great source of returns. We have transformative potentially elections in Columbia, Peru, Brazil, in Latin America, Hungary, and Israel, and EMEA, EM are all going to be very closely watched, and be opportunities within markets.

• The forward 12-month P/E ratio is 22.2, which is above the 5-year average (20.0) and above the 10-year average (18.8).
• Where do you think the global economy is headed in 2026 and what are the key factors to watch?
• Country-specific regulations could also impact AI and big data companies.
• And if that’s right, it’ll mark the tenth consecutive period of growth – and the fifth consecutive one in double digits.

Investors Are Getting Spooked By Big Tech’s Big Spending

Will sticky inflation remain a prevailing theme next year? And with that, we begin to start to see a turn again towards labor market tightening, which basically shifts from what has been some softening we’ve seen in the U.S. and other countries this year. And it’s also being emphasized by the fact that as job growth recovers here, we continue to see weak labor supply dynamics, immigration policies, having shifted materially across most advanced economies. The second thing we would look for is less synchronized, but still overall sticky inflation in that environment.

• And we therefore get as we move through 2026, an alignment of solid growth with more normal performance in terms of job growth rebounding.
• La-Z-Boy posted an earnings and revenue beat in its third-quarter report delivered Tuesday afternoon, but weak guidance is sending the stock lower.
• All sectors except Utilities saw estimates decline, with the most significant reductions in Materials, Consumer Discretionary, and Industrials (Exhibit 4).
• But the risks on balance, if we do get a large move, I think is skewed to the downside.

Views: Income, Selectivity And Dispersion

Across global credit markets, focus is shifting from the macro to the micro, and spreads are expected to widen in 2026. However, global GDP growth is expected to receive a boost in the first half of the year thanks to front-loaded fiscal stimulus, promoting a rebound in sentiment. So, with growth being solid, with labor markets starting to show stronger demand, with sentiment picking up, we think the overall environment is going to be one in which inflation stays elevated. In industrials, though AI-adjacent companies retain the upper hand, we saw improving orders among cyclically exposed segments and above-consensus earnings growth that could be signaling better times ahead. His weekly research report, “Earnings Insight,” provides analysis and commentary on trends in corporate earnings data for the S&P 500 including revisions to estimates, year-over-year growth, performance relative to expectations, and valuations.

• Morgan Global Research estimates the AI supercycle driving above-trend earnings growth of 13–15% for at least the next two years.
• It also said that adjusted net revenue growth will come in at roughly 5% by the end of this year, or slightly higher than analysts’ forecast of 4.7%.
• Otherwise, EM debt dynamics for both sovereign and corporate credit look pretty stable at relatively benign levels.
• AI technology relies on large data sets, which can lead to inaccuracies.

Our New S&p 500 Earnings & Price Targets Under Trump’s Reign Of Tariffs

Uh, and those are risks that come from the global interest rate environment. That means that EM central banks will not be able to cut as broadly as they have in the last few years, so we have to position for more differentiation around central banks, uh, in rate markets. There’s been a lot of monetary easing, but the growth environment looks pretty supportive on emerging market inflation. And will address to some extent the concentration risk that is in the markets.

Insights & Resources

During the upcoming week, 127 S&P 500 companies (including 4 Dow 30 components) are scheduled to report results for the fourth quarter. Ten sectors are reporting year-over-year growth in revenues, led by the Information Technology and Communication Services sectors. It will also mark the 21st consecutive quarter of revenue growth for the index. In aggregate, companies are reporting revenues that are 1.2% above the estimates, which is below the 5-year average of 2.0% and below the 10-year average of 1.4%. In terms of revenues, 65% of S&P 500 companies have reported actual revenues above estimates, which is below the 5-year average of 70% and below the 10-year average of 66%.

We’re also expecting issuance related to M&A and LBO activity to pick up in both high grade and high yield. Specifically, we’re expecting a notable pickup in net issuance, not least here in the U.S., obviously expecting continued supply from the AI ecosystem and the AI adjacent ecosystem. So we do think dollar yen will breach 160 in 2026 and remains, yen risks remains key to the downside. So that can be offsetting factors from time to time. But I also think equally Eurodollar can spend long periods consolidating because while Eurozone is on its own growth part on the fiscal front, the U.S. is on its own growth part with AI and tech.

Active funds are subject to management risk, which means the fund manager’s techniques may not produce desired results, and the selected securities may not align with the fund’s investment objective. Regulatory scrutiny could limit AI development, with data collection facing closer examination and potential fines. AI technology relies on large Everestex review data sets, which can lead to inaccuracies. Equities may decline in value due to both real and perceived general market, economic, and industry conditions. This material is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy.

The estimated (year-over-year) earnings growth rate for CY 2026 is 15.0%, which is above the trailing 10-year average (annual) earnings growth rate of 8.6% (2015 – 2024). As a group, they are expected to contribute 45% of the net earnings growth in Q1. On a quarter-over-year basis, earnings growth stands at -9.0%—the weakest rate since 2020. Q1 is expected to be the weakest quarter in 2025, with growth expected to reaccelerate to 10-12% in the remaining quarters of the year (Exhibit 1). If inflation fall faster than expected, the Fed could deliver more easy, bringing rates down to or even below the terminal level that they currently priced in. Um, we expect the Bank of England to cut rates to about 3.5% by the middle of next year, which is a little more than priced into markets.