- Technology and energy remain the market’s strongest-performing sectors year-to-date
- S&P 500 technology companies delivered nearly 30 per cent revenue growth and 54 per cent earnings growth in Q1
- Fund managers now view long semiconductors as the most overcrowded trade, signalling potential caution ahead
Strong tech earnings continue to drive market leadership
Technology continues to dominate market leadership in 2026, and according to Bruce Campbell, the earnings data may justify much of the enthusiasm.
In this week’s Markets in Motion, Campbell highlights how both technology and energy have emerged as the top-performing sectors year-to-date. While concerns around valuation remain common, the underlying earnings growth tells a different story.
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Q1 revenue growth for the S&P 500 technology sector came in near 30 per cent, while earnings growth surged roughly 54 per cent year-over-year — significantly outpacing most other sectors. By comparison, healthcare has lagged both fundamentally and in market performance, while energy earnings are expected to strengthen later in the year as higher oil prices begin flowing through results.
Campbell also points to valuation metrics like the PEG ratio, which compares price-to-earnings against growth rates. Despite claims that markets are becoming excessively expensive, current growth levels suggest valuations may still be more reasonable than many investors assume — particularly in technology.
The takeaway: strong earnings momentum remains supportive, but investors should avoid becoming complacent as leadership narrows.
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