Wall Street Week Ahead: Spiking bond yields, midterms, earnings to test US stocks' typical fourth-quarter strength
As the fourth quarter commences, US stocks traditionally experience a positive trajectory. Nonetheless, investors face hurdles such as climbing bond yields and a heavy reliance on AI expenditures. Coupled with the looming corporate earnings season and the November elections, market unpredictability intensifies. Analysts predict notable earnings growth, particularly driven by investments in AI…
US stocks face a challenging week ahead as investors grapple with rising bond yields, the upcoming midterm elections, and earnings reports. The benchmark S&P 500 gained nearly 13% in 2026, despite already being 1% below its mid-August record high. The fourth quarter typically sees stock gains, with the S&P 500 averaging a 4.2% increase since 1945.
However, midterm years have historically been weaker, averaging a 6.4% gain. The year 2026 has been an exception, with the S&P 500 defying the trend and showing no significant drop. The main concerns for the market are the surge in bond yields, which hit 5.34% on Thursday, and the potential impact of Federal Reserve minutes released on Wednesday.
Corporate earnings and AI spending are also expected to play a significant role in shaping the market's performance.
Written by urgent.news from The Economic Times - Top News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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