Wall Street’s earnings season is kicking off with expectations at their lowest since the end of 2023, as analysts forecast just 4.8% year-over-year EPS growth for the S&P 500—well below the double-digit gains seen earlier this year. The recent market rebound, especially after "Liberation Day," has been driven almost entirely by the largest companies: the so-called "Magnificent Seven" account for nearly half of the S&P 500's total return in this period, highlighting a significant concentration of capital in a handful of stocks.
This overconcentration raises the risk that the broader index could be more vulnerable to swings in sentiment toward these few giants, making earnings reports from big tech and AI leaders particularly crucial. However, with expectations set so low and estimates revised down more than usual, there is considerable room for companies—especially those outside the leading group—to deliver positive surprises that could fuel broader market gains.
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Create account Try a demo Download mobile app Download mobile appThe banking sector, which opens the season, faces some of the weakest forecasts in the index, yet increased market volatility in Q2 could mean trading revenues come in stronger than anticipated, providing potential upside not yet reflected in consensus estimates. As the season begins, investors will be watching closely to see if results justify the market’s record highs or if the rally’s narrow leadership leaves stocks exposed to disappointment.
Earnings calendar for this week below:
Source: XTB
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