Corporate Earnings: A Powerful Undercurrent
Despite recent worries, rising credit card delinquencies, increases in announced layoffs, and other soft spots across the economy, corporate earnings continue to deliver strong support for equity markets. In the third quarter, 82% of S&P 500 companies surpassed earnings expectations, handily beating the four-year average of 76.3%. Year-over-year earnings growth for the index reached 13.1% as of November 7th, on pace to mark the fourth consecutive quarter of double-digit earnings expansion. With analysts expecting record earnings in the coming quarters, valuation questions naturally follow. The S&P 500’s forward price-to-earnings ratio stood at 23.1 in late October, well above the 10-year average of 18.6. Whether these valuations represent overpricing or simply reflect confidence in consistent earnings growth remains an essential question as investors assess market durability. For now, strong fundamentals continue to underpin equity performance and will remain a critical factor to watch moving into the fourth quarter./span>
Technical Signals: A Market Building Its Floor
While earnings paint the fundamental picture, technical analysis helps interpret how investors are reacting in real time. The recent movement of the S&P 500 offers several key insights into short-term market behavior. A central indicator is the 50-day moving average, which represents the average entry point of recent buyers. Throughout the year, the index has repeatedly dipped to this level and bounced higher. These rebounds suggest that investors reaching breakeven levels are choosing to reinvest rather than exit, reinforcing confidence and helping form a “floor” in the market. The primary support level being monitored sits at 6,646 on the S&P 500. Should the index fall below that mark, the next significant support level appears near 6,344. These levels are not meant as day-trading signals, but rather as structural indicators of investor sentiment. When combined with robust earnings growth, these technical patterns suggest that the market is forming a stable foundation heading into year-end—one supported by both improving fundamentals and strengthening investor conviction.
Government Policy & Business Confidence: Conditions Set for 2026
With the longest government shutdown in U.S. history now concluded, attention has shifted to broader economic conditions and what lies ahead in 2026. A combination of business and consumer tax cuts is expected to inject roughly $285 billion of additional stimulus into the economy that year. At the same time, a more accommodative Federal Reserve, characterized by rate cuts and an end-to-balance-sheet contraction, adds further tailwinds. Even during the shutdown, third-party surveys provided meaningful insights into executive sentiment. CEO confidence, measured by the Chief Executive Group, rose sharply in early November. Executives reported signs of strengthening demand, renewed capital projects, easing inflation pressures, and more clarity on tariffs. As confidence improves, companies are signaling plans to increase hiring, expand revenue, and pursue strategic growth initiatives in the coming 12 months. Deal-making activity reflects this shift in tone. Mergers and acquisitions are gaining steam, supported by a friendlier regulatory backdrop. Initial public offerings, which nearly disappeared in 2022 and remained sluggish through 2023, are also showing signs of revival as market conditions turn more favorable. These developments suggest a growing willingness among corporate leaders to deploy capital and pursue long-term opportunities, an encouraging sign for economic momentum heading into 2026.
Greg Powell, CIMA®
President and CEO
Wealth Consultant
Email Greg Powell here
Bobby Norman, CFP®, AIF®, CEPA®
Managing Director
Wealth Consultant
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Trey Booth, CFA®, AIF®
Chief Investment Officer
Wealth Consultant
Email Trey Booth here
Ty Miller, AIF®
Vice President
Wealth Consultant
Email Ty Miller here
Fi Plan Partners is an independent investment firm in Birmingham, AL, with a team of professionals serving clients across the nation through financial planning, wealth management and business consulting. The team at Fi Plan Partners creates strategies in the best interest of their clients using fee based investing.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.
Economic forecasts set forth in this presentation may not develop as predicted.
No strategy can ensure success or protect against a loss.
Stock investing involves risk including potential loss of principal.
Securities and advisory services offered through LPL Financial, Member FINRA/SIPC and a registered investment advisor.
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