Q1 Earnings Off To Strong Start; Record CEO Confidence Anchor Market

• Big banks showed bifurcation: Goldman Sachs reported 48% surge in investment banking fees with $17.55 EPS, while JPMorgan and Bank of America trimmed full-year Net Interest Income guidance despite healthy consumer spending
• Semiconductor sector demonstrates 'AI Supercycle' momentum: TSMC posted record Q1 revenue on 2nm/3nm chip demand, while ASML raised 2025 sales guidance to €40 billion, driven by insatiable infrastructure demand
• Information Technology sector leads earnings expansion with projected 45% growth, while blended S&P 500 revenue growth reached 9.9%, the highest top-line growth rate since Q3 2022

Market Summary: Q1 2026 Earnings Season Launches Strong

Key Highlights

Earnings Performance:

The S&P 500 is projected to deliver its sixth consecutive quarter of double-digit earnings growth at 13.2%, driven primarily by a 45% expansion in the Information Technology sector. Blended revenue growth reached 9.9%, the highest top-line growth since Q3 2022.

Banking Sector:

Major banks reported strong results with notable bifurcation between Wall Street and Main Street operations. Goldman Sachs led with a 48% surge in investment banking fees and $17.55 EPS. JPMorgan, Bank of America, Morgan Stanley, Citigroup, and Wells Fargo all delivered solid beats, though CEOs expressed caution about persistent inflation and geopolitical tensions. JPMorgan's Jamie Dimon noted resilient consumer spending but flagged a "complex set of risks" ahead.

Semiconductor Strength:

TSMC posted record Q1 revenue driven by surging 2nm and 3nm chip demand. ASML raised full-year 2026 sales guidance to €40 billion, citing an "AI Supercycle" outpacing current supply capacity. The sector appears fueled by structural infrastructure demand rather than cyclical trends.

CEO Confidence:

The proprietary LERI (Leadership Earnings Reporting Index) registered 55, the lowest Q2 reading in eight years of data, indicating exceptionally high CEO confidence and visibility into near-term business conditions.

Upcoming Catalysts:

Peak earnings season expected April 27-May 15, with over 2,500 reports weekly. Major tech companies, IBM, UnitedHealth, Boeing, and 3M report next. Key economic data includes retail sales (April 21) and University of Michigan consumer sentiment (April 24).

The strong start suggests corporate performance is anchoring markets despite geopolitical uncertainty.