The Fuel Behind The Rally..

May 29, 2026

I’ve mentioned earnings several times over the last few weeks because I think they’re one of the most important stories in the market right now.

Last week, we talked about the consumer continuing to spend and how consumer spending makes up roughly 70% of the U.S. economy. Strong consumer spending helps drive revenue for businesses, which ultimately flows through to earnings.

With roughly 95% of S&P 500 companies now reporting first-quarter results, it’s worth taking a deeper dive into what’s happening underneath the surface.

Because while the headlines change every day, earnings are still the fuel that’s powering this market.

This quarter was the strongest in nearly 5 years.

S&P 500 earnings grew nearly 29% compared to the same quarter last year. That marks the sixth consecutive quarter of double-digit earnings growth.

On top of that, 84% of companies beat earnings estimates and 81% beat revenue estimates.

And the strength wasn’t limited to technology. 10 of the 11 sectors in the S&P 500 grew earnings year-over-year this quarter, with Health Care being the loan exception. That tells us earnings growth is much broader than many investors realize.

Headline’s dominate the news cycle day to day… but over the long-run earnings drive the market.

I’m also tired of hearing its “just the MAG 7”.  It’s true they are at the head of the pack but if you strip out their earnings the S&P500 earnings growth was still roughly 17%.

That’s the biggest story.

Does this mean stocks move straight up from here until next quarter’s reports?
Absolutely not…

Markets will continue to react to interest rates, inflation data, geopolitical events, and whatever headline happens to be front and center that day.

There will be pullbacks. There will be corrections. That’s normal.

But if you’re looking for one of the biggest reasons stocks have continued to move higher despite all the noise, earnings are at the top of the list.

And make no mistake about it- earnings matter… a lot

Things can change. They always do.

But right now, corporate America is strong, profits are growing, and that’s a tailwind investors shouldn’t ignore.

Just one video this week (link is below), but I’ve got a good one in the works for Monday. Stay tuned…

Have a great weekend!