Market Outlook
With the S&P 500 trading at roughly 23 times forward earnings—well above its historical average—investors face limited margin for error. While Wednesday’s rally reflected confidence in AI demand and easing tariff fears, market sentiment remains fragile. Any earnings misses or adverse legal developments could quickly reverse gains, particularly in growth sectors where valuations remain elevated.
Qualcomm’s after-hours results will be critical not just for its stock, but for broader tech sentiment, especially in semiconductors and handset supply chains. A weak outlook could reignite concerns about slowing device demand and the sustainability of recent AI-driven revenue growth. Conversely, a strong report may reinforce risk appetite and extend gains into Thursday.
Meanwhile, the Supreme Court’s pending ruling on trade authority introduces headline risk that could linger for weeks. A decision striking down tariff powers may offer relief to import-heavy sectors, but could also pressure domestic manufacturers and intensify fiscal debates if refunds are ordered.
With bond yields climbing and economic data mixed, traders should remain selective. Sector rotation, earnings revisions, and legal risk will likely shape the trade through the end of the week.
