Asset Management
07/27/2026 Market Strategy
July 27, 2026
Key Takeaways
With 134 companies (27% of the companies in the S&P 500) having reported Q2 results it’s still too early to draw conclusions as to how Q2 earnings season will wrap up.
Looking at current valuations and the current earnings season more factors appear to be getting better than getting worse
With results thus far as good as they’ve been -- with 10 of the eleven sectors so far showing positive earnings growth in Q2 from a year earlier and with some company managers in key sectors providing better than expected guidance as to what they believe lies ahead-- the outlook is looking even more favorable to us.
From our perch on the market radar screen it seems as if bulls, bears, skeptics, and nervous investors often are running in different directions with some projecting that the recent bull-run in equities has been so dominated and carried by technological innovation that it can’t help but end badly as the internet tech bubble did some 26 years ago. Though the market back then may have “gotten ahead of its skis,” few would have envisioned that the innovations that the internet ultimately brought would prove as ubiquitous and as deeply embedded in the lives of business and the consumer as it is today.
Others to us seem to expect a resolution of market volatility and an end to uncertainty to lie just around the corner even as outcomes in the markets and life itself are always uncertain.
In our view innovations as potentially transformational as AI may prove to be naturally disruptive and at times discomforting for businesses and society. Such progress moreover is bound to bring uncertainty as to how beneficent or destructive it will ultimately be to those they serve.
As much as the world has benefited from technological advances over the centuries, such progress has rarely been universally welcomed but rather has often generated diverse constituencies and myriad detractors with the latter in hindsight often managing only to delay the progress to come but seldom able to defeat it.
From our experience with technology as market professionals we can’t help but think that the efficiencies that are likely to come from AI will help individuals, corporations and institutions across the equity market sectors (as well as in the arts, sciences and education), to manage the mountains of important data produced in the world today to be well worth “the price of admission.”
We have found that keeping an open mind, right-sizing expectations, having a sense of context, and practicing patience and investment diversification to be helpful in navigating periods of transition and heightened uncertainties over market cycles, booms and busts during periods of transformational innovation.
When it comes to “following the money” in our view it’s about looking at a mix of monetary policy, revenues and earnings growth, key economic data, and the state of investment and innovation among other factors that carry the markets. Resilience to meet challenges remains key with these factors.
Looking at current valuations and the current earnings season more factors appear to be getting better than getting worse -- “signaling above the noise” to us a “work in progress” with the valuation of the S&P 500 and across most of its sectors somewhat tempered of late while still painting a picture of resilience in the fundamentals supporting the market.
While of course past performance is no guarantee of future results we find sustenance in words attributed to the great American author and journalist Mark Twain: “History may not repeat itself but it often rhymes.”
We remain positive on stocks particularly in the US but also from a global perspective as the current conflict in the Middle East moves towards resolution and the economic backdrop shows opportunity to move towards “the next new normal.”
Our favorite sectors of the S&P 500 remain: information technology, communications services, industrials, financials, and consumer discretionary.
We continue to favor GARP (growth at a reasonable price) stocks, and “growthier” value (avoiding value traps) and the weighting of cyclical sectors and stocks over defensives.
We expect the Fed to remain independent under the leadership of its new chairman. We expect no change in the FED’s benchmark rate coming from the FOMC meeting this week.
Chief Investment Strategist, Oppenheimer Asset Management Inc.
John is one of the most popular faces around Oppenheimer: our clients have come to rely on his market recaps for timely analysis and a confident viewpoint on the road forward. He frequently lends his expertise to CNBC, Bloomberg, Fox Business, and other notable networks.
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