AI will ignite the US stock market earnings season! Wall Street: S&P 500 second quarter earnings expected to soar by 22%

The AI investment boom and rising energy prices are injecting strong momentum into the new round of financial reporting season for US stocks. Goldman Sachs' strategy team predicts in their latest research report that earnings of S&P 500 index component stocks in the second quarter will surge by 22% year-on-year, and believes that companies as a whole have the ability to meet or exceed this target. Led by Ben Snider, the team's report points out that the core DRIVE behind this year's stock market rally is the better-than-expected corporate earnings, and the upcoming financial reporting season will be a key catalyst for market direction. Independent calculations by Bloomberg Industry Research align closely with the above assessment, with an estimated profit growth of about 23% for the second quarter, approaching the impressive performance of the previous quarter. For investors, the most crucial question right now is whether investments in AI are starting to tangible returns outside of tech giants. Goldman Sachs estimates that stocks related to AI infrastructure will contribute nearly 60% to the earnings growth of the S&P 500 index in the second quarter, with companies like Micron and Nvidia jointly contributing over 40%. AI Infrastructure: The core engine of profit growth Goldman's report clearly lists the AI investment boom as the key theme for this round of financial reporting season. The strategists wrote, "The second quarter financial report will once again confirm strong earnings growth, supported by solid macro fundamentals and a sustained wave of AI investment." The report especially emphasizes that the current market focus is not on the performance of tech giants themselves - after all, the AI spending of large-scale cloud computing companies has long been visible - but on whether a wider range of companies in the industry chain can realize profits by meeting AI demands. Whether the AI infrastructure sector can realize the nearly 60% contribution rate to earnings per share will be a critical litmus test for this logic. Energy Sector: Unexpected windfall from rising oil prices High oil prices provide another important growth theme for this round of financial reporting season. Goldman Sachs strategists point out that the expected rise in crude oil prices in the second quarter will bring considerable unexpected profits to oil producers, serving as an important support for profit growth. However, the other side of the coin is also worth noting: cost pressures are being transmitted to consumer companies. According to Goldman data, the market consensus for median companies in the S&P 500 expects a profit growth rate of around 9%, much lower than the overall index's 22%. "The significant differentiation in growth expectations between sectors and individual stocks," the strategists wrote in the report, also means that the structural differences in this round of financial reporting season will be particularly pronounced. Goldman's optimistic forecast is built on the already strong foundation of first quarter earnings reports. Earnings of S&P 500 component stocks in the first quarter grew by nearly 30% year-on-year, more than twice the analysts' previous estimate of about 12%. Goldman points out that the last time such a high-speed year-on-year profit growth was achieved outside the period of significant economic recovery was in 2004, two decades ago. This historical comparison highlights the rare strength of the current profit cycle, and sets a higher reference point for whether the momentum can continue in the second quarter. The general expectation among analysts now is that a growth rate of 22% to 23% will make this quarter another super-strong financial reporting season after the first quarter, but whether companies can once again significantly exceed expectations remains to be seen as they are individually validated. This article is reproduced from "Wall Street View" with editing by GMTEight: Jiang Yuanhua.