The setup
Goldman Sachs Chief US Equity Strategist Ben Snider is basically telling investors to take a breath. His call: S&P 500 companies are set to start reporting double-digit earnings growth beginning next week.
That matters because earnings are the market’s bedtime story. When profits are growing, stocks can usually justify higher prices without everyone having to do mental gymnastics about “future potential.”
Why this is a big deal
If the S&P really does print double-digit growth, that’s a nice little reality check for anyone who’s been hiding under the desk waiting for the next earnings season to go sideways.
It doesn’t mean every company will shine. Some will still miss, some will still blame “transitory headwinds,” and some will still make you wonder whether the conference call was recorded in a wind tunnel. But the broader message is clear: the profit backdrop may be stronger than the mood music suggests.
What investors should watch
- Whether the growth shows up broad-based or just in a handful of mega-caps
- If guidance stays sturdy or starts getting weirdly cautious
- Whether margins hold up once companies stop sounding like they’re fighting the weather, the Fed, and the supply chain all at once
Big picture: if earnings season lands the way Goldman expects, the market may have a better excuse to keep climbing than pure optimism and caffeine.