Big Banks Kick Off Q3 Earnings With S&P 500 Near Records — Strategists Flag What Could Move Markets Aashika Suresh Mon, October 12, 2026 at 9:33 PM EDT 5 min read ^GSPC -0.06% In an interview with CNBC on Monday, Matt Stucky, Northwestern Mutual senior portfolio manager, said that he expects the quarter's earnings to be a net positive.
Scott Chronert, head of U.S. equity strategy at Citi Research, said in the interview that the market will need both the AI trade and the macroeconomic backdrop to be positive to function effectively.
Aya Yoshioka, senior investment strategist at Wealth Enhancement Group, said that the earnings season would also be influenced by the cost of capital, not just from the AI trade, but also for the other "macro-sensitive companies" on the rest of the S&P 500.
Third-quarter (Q3) earnings season is set to kick off this week, with big banks starting to report their results. After a strong second quarter, market strategists expect the momentum to continue, even if at a more subdued pace than the last quarter.
In an interview with CNBC on Monday, Matt Stucky, Northwestern Mutual senior portfolio manager, said that he expects the quarter's earnings to be a "net positive."
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"I think it's going to be positive. Maybe not quite as good as the second quarter (Q2), but the second quarter was one for the record books, at kind of low 30s earnings growth year over year," Stucky said.
"If the consensus is right, we're likely to see something in the upper 20s, maybe a little bit better than that."
Scott Chronert, head of U.S. equity strategy at Citi Research, said in the interview that the market will need both the AI trade and the macroeconomic backdrop to be positive to function effectively.
"We need that AI-influenced component that we argue is just over half of the index, as well as the other half that's going to beat to a more traditional macro drummer," Chronert said.
"And so there, what we need is a combination of some of this inflation, Fed hawkish concern coming out of the market, which we think can unfold, as the data suggests, over the next couple of weeks, combined with ongoing earnings tailwinds out of this AI-influenced component, which we think we'll see as we go into the Q3 reporting period," he added.
Chronert also said that the mega-cap growth AI component remains "in pretty good stead" and that the revenue growth from Q2 should persist into the Q3 results. "How much is priced in remains to be seen, but all told, I think we need this broadening trade to come back to get to my 8,100 target."
Stucky, however, said that the main driver of markets here would likely be influenced by multiples rather than earnings.
"And really, that's a function of hawkishness from the Fed and where the 10-year rate goes," he said, adding that inflation and oil influence that, which are currently uncertain.
Aya Yoshioka, senior investment strategist at Wealth Enhancement Group, said that the earnings season would also be influenced by the cost of capital, not just from the AI trade, but also for the other "macro-sensitive companies" on the rest of the S&P 500.
While the S&P 500 has climbed nearly 14% year-to-date, and is currently celebrating a fourth bull market anniversary after having run about 120% since Oct. 12, 2022, according to a CNBC report, the returns are largely driven by technology gains.
Even as the benchmark index crossed 7,800 for the first time last week and continues to trade near records, about 40% of the index is concentrated in tech stocks.
In September, the typical S&P 500 stock lost nearly 6% on average, with more than three in four stocks being a losing bet. However, the index was down only 0.4% for the month, propped up by technology gains.
Yoshioka acknowledged that concentration has been an issue for markets, both through the 'Magnificent Seven' and the AI trade, "especially as it continues to touch 50% of all companies in the S&P 500."
However, she noted that a correction risk depends upon capital spending announcements from hyperscalers as well as the overall supply chain for AI.
"There's been so much focus on that supply chain, or all the supply-chain beneficiaries so far. And I think we really want to see a continuation from last quarter, when the hyperscalers reported really strong cloud growth, and they were seeing really good returns on the investments that they've made," she said.
"We'd like to continue to see that. If we don't get that, there could be some of a correction just to level-set where we're going to go in 2027," she added.
Among ETFs tracking benchmark indexes, the SPDR S&P 500 ETF (SPY), which tracks the S&P 500, was down 0.06% overnight at the time of writing, amid 'bullish' sentiment.
One user said, "$SPY Bank earnings will be stellar and will provide a nice pop in the first half of the session tomorrow but inflation cpi on Wednesday will be high, get rdy for some volatility. Diesel surcharges exploded across all forms of shipping in September pushing top line above expectations and I think we'll see a surprise increase in shelter costs specifically rents that'll push core beyond .2 expectations."
Meanwhile, the Invesco QQQ Trust (QQQ) was also trending 0.42% lower amid 'bullish' sentiment, while the SPDR Dow Jones Industrial Average ETF Trust (DIA) climbed 0.14% overnight, with sentiment in the 'bullish' territory.
The iShares 20+ Year Treasury Bond ETF (TLT) was up 0.28% amid 'bullish' sentiment.
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Aashika Suresh has no position in any of the stocks mentioned in this article. StockTwits' news team content is for informational purposes only and is not intended as investment advice. For more, see our editorial policy. This article was originally published on StockTwits.
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