Fourth quarter earnings season unofficially kicks off this week with a dozen banks and asset managers in the S&P 500 slated to report.
With 2025 behind us, it’s a good time to celebrate some of our better forecasts from last year while also reviewing some misses we can learn from. In our view, we got more right than wrong last year, but there were some misses among our tactical asset allocation recommendations. For the second straight year, as the bull market marched on, the most impactful decision we made was probably to recommend investors stay fully invested in equities at benchmark levels throughout the entire year despite elevated valuations.
Our 2026 fixed income outlook calls for a rangebound rate environment, cautious Fed policy, and a modest increase in spreads within corporate credit markets.
The bull market appears poised to extend its run in 2026, fueled by ongoing enthusiasm around AI and further easing of monetary policy from the Federal Reserve (Fed).
This week, we broaden our preview and tease some other factors investors will want to consider when thinking about investing in 2026.
A strong beat rate and another quarter of double-digit earnings growth proved corporate America’s resilience, bolstered by mega cap technology’s artificial intelligence (AI) investment. Here we recap third quarter earnings season, when more stayed the same than changed. Hat tip to profit margins.
As 2025 nears its final 100 calendar days, market focus is already beginning to turn forward and attempt to reconcile what market drivers could remain in place, and what could change in the first year of the new half-decade. While not an exhaustive list, here’s some of our early keys to 2026.
AI-related business investment is rapidly becoming a cornerstone of U.S. economic growth, marking a structural shift in how expansion is financed and sustained. In the first half of 2025, investment in information-processing equipment and software — largely driven by AI infrastructure — is a small yet mighty slice of the economy, yet contributed a majority to economic growth during that period.
The S&P 500 is over halfway through Q3 earnings season, and results have been impressive. Of the 318 companies that have reported results, 83% have surpassed earnings per share (EPS) estimates, notably above the 10-year average beat rate of 75%, according to FactSet.
With the stock market in record-high territory and up about 35% off the April lows, market participants clearly haven’t been too scared lately. But that doesn’t mean there aren’t plenty of things to worry about. Just because risks haven’t affected markets much lately — subprime auto loan bankruptcies notwithstanding — doesn’t mean they won’t in the future. In that “spirit,” as Halloween approaches, we discuss what scares us about the economy and financial markets.
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