S&P 500 Poised for Summer Rally on Earnings, AI Spending

The S&P 500 posted gains in nine of the past ten Junes and in each of the last ten Julys. From June 1 through July 31, the index averaged a 5.2% gain over the past decade.

Memorial Day is commonly viewed as the unofficial start of the summer trading season. Horizon Investments’ analysis identifies the June–July period as the S&P 500’s best two-month performance stretch over the last ten years.

Horizon’s asset management team wrote that recent corporate earnings growth has exceeded Wall Street forecasts. The team reported that companies have released results stronger than expected in recent quarters.

The commentary described a widening of AI-related capital spending. Investment that was initially concentrated in a few large firms has expanded to include more semiconductor manufacturers and other companies that supply technology infrastructure.

Horizon said the combination of earnings above forecasts and broader AI spending has coincided with recent market gains. The firm noted some investors may choose to lock in profits and described a bearish stance as a timing decision it views as having a relatively low probability of success under current fundamentals.

The commentary included standard investment disclosures: past performance is not indicative of future results; asset allocation cannot eliminate the risk of fluctuating prices; investors may realize losses; and forward-looking statements are not guaranteed.

The S&P 500 tracks 500 large U.S. companies. Horizon Investments’ commentary is based on public information and does not constitute an offer to buy or sell securities or personalized investment advice.