S&P 500 – Magnificent 7/Other 493 and 200-Day Moving Average The frenzy surrounding the Magnificent Seven tech stocks has faded in 2025, but these firms remain key players and are broadly keeping pace with the market, despite recent turbulence. Image: Bloomberg
Magnificent Seven Stocks vs. S&P 500 Index Since DeepSeek’s emergence in January 2025, the Magnificent Seven stocks have underperformed compared to the S&P 500, driven by AI disruption fears and concerns over capital expenditures. Image: Deutsche Bank
S&P 500 – Share of Sales Derived from Outside United States The S&P 493 (S&P 500 ex-Magnificent Seven) faces lower global trade risks than the Magnificent Seven, which rely on nearly 50% foreign sales. Image: Goldman Sachs Global Investment Research
S&P 500 Forward Earnings Estimates Wall Street’s optimistic earnings projections have sparked debate about their alignment with economic realities. While many analysts remain bullish, there are growing concerns about the sustainability of these projections. Image: Real Investment Advice
S&P 500 Fwd. Earnings Growth and Russell 2000 Fwd. Earnings Growth The recovery in EPS growth has been driven by a small number of large-cap companies, which may indicate a late-cycle extension in the economic cycle. Image: Morgan Stanley Research
Value vs. Growth – S&P 500 Index Earnings-Per-Share Growth EPS growth helps to explain why value stocks could outperform growth stocks in 2021. Image: Morgan Stanley Weath Management
Inflation – S&P 500 LTM Sales Growth vs. Core CPI Since 1970 Rising inflation tends to boost S&P 500 earnings. According to Goldman Sachs, a 100bp increase in average annual core CPI would lift the S&P 500 EPS to $170 in 2021. Image: Goldman Sachs Global Investment Research
Valuation: Utilities vs. Tech vs. S&P 500 Nice chart showing the valuation of utilities vs. Tech and the S&P 500. Currently, utilities are valued at 19.9x forward EPS, tech at 18.7x, and the S&P 500 at 16.4x Image: Fidelity Investments
S&P 500 Index Price Average Before and After Initial Fed Rate Cut Historically, the S&P 500 Index has risen in 13 out of 16 cases after an initial Fed rate cut (since 1954). The divergence between the S&P 500 and EPS suggests that the market doesn’t care too much about other things, as long as…
S&P 500 Index vs. Earnings per Share since 1989 The consensus S&P 500 earnings for the next 12 months has increased from $173 to $175. Image: Jeroen Blokland