Key takeaways

Research evidence excerpt

Key takeaways

Earnings are boosting markets. Global equities delivered an exceptional first half Equity supply is rising, but remains manageable. To finance this CAPEX,

despite concerns of a deteriorating growth-inflation mix following the Iran conflict and issuances are accelerating globally, particularly in the US, where a growing IPO

the associated spike in oil prices. Performance has been broad-based, led by Asia. pipeline is competing for the same marginal pool of capital. Europe typically follows

Europe has modestly lagged in price return terms but outperformed the US on a total the US IPO cycle with a lag, pointing to a potential increase in issuance later this

return basis. Crucially, earnings growth has explained most of the advance, marking year. Funding pressures also extend beyond equities as governments and

the transition from a valuation-led rally to a more fundamentally driven market. corporates issue debt to finance defence, infrastructure and energy-security

spending. European equity issuance has exceeded €200bn over the past 12 months,

Expectations are high, but earnings momentum remains strong. Analysts have approaching levels last seen during the Tech bubble. However, as a share of market

revised forecasts higher this year, an unusual pattern. Consensus expects S&P 500 capitalisation it stands at just 1.7%, broadly in line with the long-run average of 1.4%.

Q2 EPS growth of 22% y/y, although nearly 60% of that increase is expected to Our US colleagues reach a similar conclusion.

come from AI infrastructure-related companies. The median stock is still forecast to

grow EPS by 9% y/y. Revenue assumptions remain conservative relative to nominal Demand should continue to absorb supply. Global gross buybacks above $1tn