Valuation – S&P 500 Forwad P/E Ratio vs. ISM Manufacturing Prices Paid (Leading Indicator) The ISM Manufacturing Prices Paid Index came in hotter than expected, raising a warning flag for equity valuations. Historically, rising manufacturing prices have been followed by lower S&P 500 fwd P/Es over the next 6 to 12 months. Image: Bloomberg
AAII Asset Allocation Despite persistently bearish sentiment, U.S. retail investors grew more optimistic in September, raising their stock allocation to its highest level since December 2017. The move was a vote of confidence in equities. Image: Daily Chartbook
Hyperscaler Quarterly Y/Y Capex Growth Hyperscaler capex is expected to surge 116% year/year in Q3 2026, giving S&P 500 earnings a powerful boost. But the spending boom is likely to cool over the next few quarters. Image: Goldman Sachs Global Investment Research
S&P 500 Quarterly Net Profit Margin (ex. Financials & Utilities) Corporate America is delivering solid profits, with margins expected to reach 15% in the third quarter of 2026. For investors hoping the rally has further to run, that strength offers strong support. Image: Goldman Sachs Global Investment Research
MOVE Index and Largecap Discretionary Investors Equity Positioning Over the past few years, discretionary positioning has generally moved inversely to rates volatility, with the relationship strengthening or weakening as conditions change. Image: Deutsche Bank Asset Allocation
S&P 500 Performance After A >10% Q2 Quarter History is on the bulls’ side. Since 1950, when the S&P 500 rose more than 10% in Q2, Q4 ended in the green, with an average return of 6.1%. Bulls could hardly ask for a better backdrop. Image: Carson Investment Research
GS Financial Conditions Index U.S. financial conditions excluding equities have tightened meaningfully, but the broader backdrop remains accommodative and is still supporting growth rather than restraining activity. Image: Goldman Sachs Global Investment Research
Sentiment Indicator and Stock Positioning Goldman Sachs’ U.S. Equity Sentiment Indicator has slipped to -0.9. After similar readings, the S&P 500 has historically averaged a 0.5% gain over the following month. Image: Goldman Sachs Global Investment Research
Net Speculative Position in EUR/USD With speculators already net short, the euro could face renewed selling if bearish bets increase or economic data deteriorate. Image: J.P. Morgan Flows and Liquidity
S&P 500 Quarterly YoY EPS Growth Relative to Consensus Expectations Analysts expect S&P 500 earnings to jump 27% year on year in 3Q 2026, powered largely by strong tech profits. Once again, tech is carrying the market. Image: Goldman Sachs Global Investment Research
S&P 500 CAPE Ratio vs. Subsequent 10 Year Annualized Real Return The S&P 500 is trading at a Shiller CAPE level seen only during the market’s most expensive episodes. History points to real annualized returns of between -3.8% and -1.4% over the next 10 years. Image: Real Investment Advice