The S&P 500 returned 12.8% from Election Day 2024 through April 10, 2026, according to FactSet market data. Higher oil prices and tariff headlines created volatility, yet corporate results held firm and policy moves delivered support.
Amid concerns about war, oil prices, inflation, and the economy, bulls are zeroing in on three clear positives: earnings momentum that outpaces expectations, policy tailwinds that boost cash flow, and sentiment readings that flash historic opportunity. These signals matter because they point to pockets of strength where smart investors can add exposure without chasing the entire index. Let’s walk through each one with the numbers that count.
Strong Corporate Earnings Growth
Fourth-quarter 2025 S&P 500 earnings expanded 13.4% while revenue grew 9.2%, according to the U.S. Bank Asset Management Group analysis of company SEC filings, while Morgan Stanley’s Global Investment Committee projects 15% earnings-per-share growth for full-year 2026. That pace beats the long-term average and comes despite energy costs.
Microsoft (NASDAQ:MSFT | MSFT Price Prediction) reported fiscal second-quarter 2026 revenue of $81.3 billion, up 17% year-over-year. Cloud revenue rose 26%. The results outpaced the S&P 500 average and beat consensus estimates by 3%. Nvidia (NASDAQ:NVDA) generated data-center revenue of $62.3 billion in its fiscal fourth quarter, up 75% year-over-year, and Taiwan Semiconductor Manufacturing (NYSE:TSM) just cemented the AI demand growth story by posting preliminary revenue figures showing 35% growth in the same period. Microsoft and Nvidia together show how earnings leaders carry the index even when broader sentiment wavers.
Policy Tailwinds
The One Big Beautiful Bill Act, signed in mid-2025, made 2017 tax cuts permanent and restored 100% bonus depreciation plus immediate R&D expensing, starting in January. These changes cut effective tax rates and free up cash for investment and shareholder returns.
JPMorgan Chase (NYSE:JPM) posted net interest income of $25 billion in its fourth-quarter 2025 results, up 7% year-over-year. The bank returned $15 billion to shareholders through dividends and buybacks for all of 2025. Bank of America (NYSE:BAC), on the other hand, grew net interest income 10% over the same span.
This shows JPMorgan Chase captures the policy edge more clearly than its largest peer, giving bulls a tangible example of how deregulation and tax certainty translate into higher free cash flow and buyback support.
Sentiment and Contrarian Indicators
The American Association of Individual Investors weekly sentiment survey for the week ended April 3 showed only 35% bulls while bears reached 42% — levels last seen near market lows. Such extremes often precede rebounds. As it happens, the AAII data set since 1987 shows stocks returned an average 20% over the next 12 months when bull readings dipped below 40%.
Warren Buffett captured the dynamic in his 1986 Berkshire Hathaway (NYSE:BRK-A)(NYSE:BRK-B) annual letter to shareholders: “Be fearful when others are greedy and greedy when others are fearful.” That mindset keeps bulls buying quality names on weakness rather than joining the crowd in panic. The combination of low sentiment and solid earnings creates the setup investors watch for entry points.
Key Takeaway
In short, earnings growth of 15% for 2026, policy-driven cash flow at names like JPMorgan Chase, and sentiment extremes that historically deliver 20% returns give bulls plenty to watch. Regardless of how you look at it, the data favors selective buying over blanket selling.
When all is said and done, add to leaders such as Microsoft or JPMorgan Chase on any large pullback while monitoring investor sentiment from sources like the AAII survey and quarterly earnings releases. Remaining diversified and keeping positions from becoming too big of a percentage of your portfolio, will allow you to turn the mixed signals the market is giving off today into tomorrow’s gains.
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