by Sagarika Jaisinghani
Investors are counting on US stocks to rally on the back of a robust corporate earnings season, before the market loses steam toward year-end, according to Bank of America Corp. strategists.
Client feedback suggests “no one” is worried about the economy or equity valuations, strategist Michael Hartnett wrote in a note. A majority of them expect a forecast-beating second-quarter reporting season and for companies to pledge higher spending on artificial intelligence.
Trading consensus is for more gains in the S&P 500 Index into the Federal Reserve’s annual economic symposium in Jackson Hole in late August, Hartnett said. That is likely to be followed by a “healthy ‘back’n’fill’ correction.”
US stocks have surged 26% from an April low after President Donald Trump paused some tariffs. The S&P 500 is back at record highs, also driven by resilient economic growth, but the benchmark is still trailing international peers this year.
Focus next week will shift to the earnings season. Analysts expect S&P 500 profits to rise 2.8% year over year, a sharp slowdown after a 14% jump in the previous quarter, according to data compiled by Bloomberg Intelligence.
Traders at Goldman Sachs Group Inc. have also said they expect further gains in the US benchmark before the rally fades into August.
Meanwhile, tariff-driven volatility has settled in the last few weeks amid America’s trade negotiations with key partners. Hartnett said BofA’s equity and credit clients are betting on the so-called TACO trade, an acronym that stands for “Trump Always Chickens Out.”
Copyright Bloomberg News
With more than $13 billion in assets, American Portfolio Advisors closed last October.
Robert D. Kendall brings decades of experience, including roles at DWS Americas and a former investment unit within Morgan Stanley, as he steps into a global leadership position.
Snowden Lane taps Pontera for held-away retirement account management, while Opto Investments enhances an Indiana-based independent RIA's private markets offering.
The $420 million RIA in Auburn Hills and Ann Arbor gives Credent its second and third Michigan locations while pushing it closer to $4 billion in AUM.
New survey reveals heightened investor concern over market volatility, retirement readiness, and the impact of tariffs on living costs.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.