Can AI earnings keep outrunning oil and bond yields?
The S&P 500 gained 0.58% and the Nasdaq Composite rose 0.45% on Tuesday, taking both indexes to record closing highs as investors favored technology stocks.[2][4] By Wednesday, MSCI’s Asia Pacific gauge had fallen 0.6%, Brent crude was near $101.50 a barrel and the US 10-year Treasury yield had climbed to 5.31%.[1]
US equity strength is increasingly tied to a concentrated group of cash-rich AI and mega-cap companies, making the approaching earnings season a test of whether massive AI investment is producing enough profit to offset expensive energy and capital.[1][2]
Key insights
- The S&P 500 has gained 14% in 2026 and the Nasdaq Composite 18.78%, despite elevated oil prices and a sell-off in US government debt.[2]
- Asian technology shares weakened even as Wall Street’s technology-led indexes set records, showing that enthusiasm for the AI buildout is not lifting all related markets equally.[1]
- Analysts expect strong third-quarter earnings, with Bloomberg Intelligence projecting roughly 25% year-over-year S&P 500 profit growth and LSEG estimating 30.6% aggregate growth.[1][4]
- Markets were pricing about an 80% probability that the Federal Reserve would leave rates unchanged at its next meeting, while investors awaited its September meeting minutes.[3]