Earnings
Q2 2026 EARNINGS SEASON:
BIG NUMBERS MEET A NERVOUS TAPE
MAULER TERMINAL RESEARCH · 2026-07-05 · season kicks off week of Jul 6 · symbols: NQ ES YM XLF
BY RYAN, FRANK & DILLON · MARKET MAULERS FOUNDERS
Q2 earnings season lands in the middle of the sharpest index divergence of the year — YM at all-time highs while NQ digests an AI/semi unwind. The expectations bar is enormous. Whether companies clear it decides if this rotation stays a rotation or turns into something worse.
The Expectations Bar
| Metric | Estimate | Source |
|---|
| S&P 500 Q2 EPS growth (y/y) | +23.1% | FactSet |
| S&P 500 Q2 revenue growth (y/y) | +12.3% | FactSet |
| S&P 500 Q2 EPS growth (y/y) | +21.8% | Zacks |
| S&P 500 Q2 revenue growth (y/y) | +10.9% | Zacks |
Read it straight: +23% EPS growth is a banner-year number. It is also a fully priced number — the S&P trades at record valuations. Beats are expected; the tape will move on guidance, not the print.
The Calendar
| When | What | Futures relevance |
|---|
| Week of Jul 6 | Early reports: PepsiCo, Delta | Tone-setters, low index weight |
| Mon Jul 13 → | Banks in earnest: JPM, Citi, then the money-center wave | YM/XLF leg of the rotation gets tested first |
| Late Jul – Aug | Mega-cap tech + semis | The NQ verdict: AI capex guidance vs the semi selloff |
| Jul 28-29 (mid-season) | FOMC decision cuts through earnings flow | Two catalysts stacked — expect elevated event vol |
Sector Expectations (Zacks, y/y EPS growth)
| Sector | Q2 EPS growth est. | Note |
|---|
| Energy | +114.0% | Largest estimate revisions UP (+61.5% since quarter start) — oil-shock windfall |
| Basic Materials | +47.1% | Reflation beneficiary |
| Technology | +43.6% | Second-largest revisions up (+8.7%) — but the AI trade is being repriced anyway |
| Utilities | +14.6% | Modest, rate-hostage |
| Aerospace | +10.8% | Defense budget cycle |
| Industrial Products | +10.2% | Reshoring, backlogs |
Growth is expected in 11 of 16 Zacks sectors. The concentration issue: most of the upward revision has come from just two sectors — Energy and Tech.
What Actually Matters This Season
- AI capex guidance is the whole ballgame for NQ. The semi selloff was a demand-doubt event (SK Hynix HBM slowdown, cautious AVGO outlook, memory pricing). If mega-cap buyers reaffirm spend, the unwind reverses hard. If anyone blinks, the -43.6% expectation math gets ugly fast.
- Banks test the YM leg first (Jul 13+). Financials have been the rotation's destination. Strong NII and trading revenue keep the YM bid alive; misses would kneecap the "safe side" of the divergence trade.
- Margins vs the inflation spike. CPI running 4.2% y/y — companies either have pricing power or they don't. Watch gross margin commentary, not just EPS.
- Guidance on tariffs, energy costs, and rates — the three inputs every CFO will get asked about.
- Record valuations = zero forgiveness. At these multiples, in-line guidance gets sold. The asymmetry is to the downside on any wobble.
Scenarios for the Futures
| Scenario | NQ | ES | YM |
|---|
| Beats + strong AI capex guidance | Sharp squeeze — crowded shorts, intact trend channel | New highs | Lags on rotation reversing |
| Beats + soft guidance | Divergence extends | Chop, range | Rotation continues, ATH grind |
| Bank misses (Jul 13 week) | Sympathy pressure | Breaks consolidation lower | Rotation thesis damaged — both legs sell |
| Hot CPI into Jul 29 FOMC | Multiple compression | Risk-off | Nowhere to hide — correlation snaps back to 1 the bad way |
Key Takeaways
- Q2 expectations (+21-23% EPS) are the strongest in years and fully priced. Guidance decides everything.
- Sequence matters: banks Jul 13 test YM's leg, mega-cap tech in late July tests NQ's — with the FOMC wedged between.
- Energy and Tech carry the growth; concentration cuts both ways.
- For the divergence trade: earnings season is the event that either re-correlates the indices or blows the spread wider.
Sources
IMPORTANT DISCLAIMER: This is for informational and educational purposes only and does not constitute financial, investment, trading, or tax advice. Past performance is not indicative of future results. All investments involve risk, including the potential loss of principal. Data may not be real-time or complete. Always do your own due diligence and consult a qualified financial advisor before making any investment decisions.