HSBC: AI-Driven Earnings Support US Equities

HSBC analysts Willem Sels and Lucia Ku have weighed in on the outlook for US equities, arguing that worries over mega IPOs and elevated valuations are being counterbalanced by robust earnings growth.

According to the analysts, AI-related tailwinds are driving earnings improvement across most sectors of the S&P 500, providing a support base for the market despite lingering valuation concerns.

The assessment suggests that the current earnings cycle remains a key positive factor, even as headwinds from new issuance and stretched multiples persist.