With 98% of the S&P 500 having reported their earnings, Wall Street is wrapping up the first quarter with optimism. Despite CEOs warning about consumer pullbacks, 78% of companies beat earnings expectations, a figure above both analysts’ predictions and historical averages.

• According to FactSet, the S&P 500 marked its 14th consecutive quarter of revenue growth, boasting the highest year-over-year (YoY) earnings growth rate since Q1 2022.
• Earnings rose by 5.9%, while blended revenues increased by 4.2% YoY, driven by strong performances in the communication services, financials, and information tech sectors.

All about expectations: Bucking negative economic data, analysts have raised their expectations for S&P 500 firms in the upcoming quarter. The optimism is fueled by rosier company forecasts, especially in the energy and materials sectors. Additionally, mentions of “recession” on company earnings calls have declined, with doomsday discussions at their lowest since Q1 2022.