Live Markets: S&P 500 earnings are rising. What will retail bring?

Ross Stores

14/08/2026 18:31

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S&P 500 EARNINGS ARE RISING. WHAT WILL RETAIL BRING?
Blended expectations for second-quarter earnings among S&P 500 .SPX companies edged up in the last week with the adjusted year-over-year growth rate now expected to be 33.1%, up from 32.7% a week ago, according to the latest data from LSEG. 
This compares with expectations for 24.4% on July 1, before the reporting season began, according to reports from Tajinder Dhillon, head of earnings and equity research at LSEG.
Both last week's and this week's numbers were adjusted to exclude mark-to-market investment gains at Amazon AMZN.O and Alphabet GOOGL.O, which, if included, would bring the growth rate to a staggering 51.6% for the quarter. If the energy sector is excluded that number would drop to 47.7%. 
The growth rate for the current week includes numbers from the 453 companies that have already reported, up from 436 last week, and estimates for those that have yet to report their results.
While the volume of releases is starting to slow, the upcoming week includes a ramp-up in reports from key retailers, which should help fill out any blank spots in our understanding of U.S. consumer health.    
Reports are expected from blue-chip companies such as Walmart WMT.O and Home Depot HD.N. Also,  Target Corp TGT.N, Lowe's LOW.N, TJX companies TJX.N, Ross Stores ROST.O and BJ's Wholesale Club BJ.N are due to report next week. 
Walmart, so far, is expected to report more than 5% revenue growth compared with Home Depot's more than 4%, Target's 3.7%, Lowe's 9.2%, TJX's 5.4%, Ross's 10.9% and BJ's 10.7%. 
And, after Friday's cloudy retail sales and consumer sentiment reports it will be interesting to see how investors will receive the retailers' reports. 
Jharonne Martis, director of consumer research at LSEG, had this to say in her report on Friday:
“The U.S. consumer remains resilient enough to support earnings growth, but that resilience is increasingly concentrated. The LSEG Retail & Restaurant Index suggests strong profit growth is being driven by a handful of large, high-margin retailers, while guidance across the broader sector points to a more cautious outlook for discretionary spending in the second half of the year."
Meanwhile, the S&P 500 consumer discretionary index .SPLRCD is down 0.4% on the day and eyeing a 1.8% drop for the week. On a year-to-date basis, it is also the biggest laggard among the benchmark's 11 major sectors, with a 0.7% advance.    
     
(Sinéad Carew)
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