S&P 500 Climbs to Record High on Earnings Optimism: Markets Wrap
(Bloomberg) — Wall Street traders drove stocks to all-time highs on growing bets that Corporate America will be able to weather the threats from still-elevated energy costs and interest rates.
Just a week ahead of the earnings season, the S&P 500 notched its first record since August. An advance in artificial intelligence-related shares also buoyed sentiment, with Nvidia Corp.’s market value approaching $6 trillion. Advanced Micro Devices Inc.’s Lisa Su predicted “very high” chip demand over the next few years. Treasury 10-year yields fell from the highest since 2002.
While bets on the path for global monetary policy and geopolitical developments have captured investors’ attention, a less discussed factor has been strong earnings expectations, noted Kyle Rodda at Capital.com.
“The US economy remains supportive of corporate revenues and profits,” said Ulrike Hoffmann-Burchardi at UBS Chief Investment Office.“A favorable growth environment and robust earnings suggest profit growth can broaden beyond technology.”
Analysts expect a roughly 25% increase in third-quarter S&P 500 profits from a year earlier, according to data compiled by Bloomberg Intelligence.
“Recent economic growth data have been strong and S&P 500 earnings revision breadth has remained positive,” Goldman Sachs Group Inc. strategists led by Ben Snider wrote in a recent note. “We expect most companies will once again surpass consensus earnings estimates this quarter.”
At Ameriprise, Anthony Saglimbene noted that equities have historically weathered rising-rate periods when the economy and profits kept growing.
“Stocks have room to move higher if the 2027 outlook for growth and profits remains firm, energy prices stabilize/fall, and the Fed signals its rate-hiking path will be short-lived,” he said. “Of course, any advance in stock prices through year-end will likely require a steady AI trade as well.”
As geopolitical fragmentation continues, most major economies are absorbing higher energy prices and tariffs better than expected, according to Tiffany Wilding and Andrew Balls at Pacific Investment Management Co.
“A booming AI investment cycle, the ability of consumers and China to absorb higher costs, and an incremental approach by central banks may help support growth while containing inflation,” they added.
Corporate Highlights:
Paramount Skydance Corp. closed its $110 billion acquisition of Warner Bros. Discovery Inc., completing one of the biggest media mergers of all time after engaging in a bruising battle for control with Netflix Inc. and fending off antitrust lawsuits. Alphabet Inc. agreed to buy nuclear power from Constellation Energy Corp. in a deal that will spur the addition of 890 megawatts of new reactor capacity. Anthropic PBC is expanding access to its most advanced AI models, allowing a select group of organizations to test the startup’s cutting-edge cyber capabilities in collaboration with the US government. Anthropic’s Mythos AI model has dramatically increased global cybersecurity risks, JPMorgan Chase & Co. Chief Executive Officer Jamie Dimon said. OpenAI is in talks with multiple investment funds from the United Arab Emirates, including Abu Dhabi-based MGX, to help anchor a $30 billion round of financing for the ChatGPT maker, according to people familiar with the matter. Some of the main moves in markets:
Stocks
The S&P 500 rose 0.6% as of 4 p.m. New York time The Nasdaq 100 rose 0.5% The Dow Jones Industrial Average rose 0.5% The MSCI World Index rose 0.7% Currencies
The Bloomberg Dollar Spot Index fell 0.2% The euro rose 0.3% to $1.1260 The British pound rose 0.4% to $1.3276 The Japanese yen fell 0.2% to 158.16 per dollar Cryptocurrencies
Bitcoin fell 0.2% to $85,614.81 Ether fell 0.7% to $2,692.77 Bonds
The yield on 10-year Treasuries declined two basis points to 5.28% Germany’s 10-year yield declined two basis points to 3.48% Britain’s 10-year yield declined four basis points to 5.37% Commodities
West Texas Intermediate crude rose 0.5% to $89.91 a barrel Spot gold rose 0.7% to $4,168.96 an ounce ©2026 Bloomberg L.P.
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