Does The S&P 500 Have Enough Earnings To Continue To Fuel This Rally?

The stock market continues to push higher, reaching multiple all-time highs this year, with much of the rally being supported by exceptionally strong corporate earnings. S&P 500 earnings growth is now running at its fastest pace since 2021. Year over year, earnings for the S&P 493 are growing by 22%, while the Magnificent 7 are delivering a much stronger 55% growth rate. With the Magnificent 7 accounting for roughly 30% of the S&P 500, their outsized earnings growth is providing a significant boost to the overall index. Meanwhile, the other 493 companies, which represent a much broader range of industries, are growing earnings at a more modest 22%, still a strong rate, but well below the pace of the largest technology companies.