The S&P 500 has gained 13.5% in 2026, outpacing US consumer prices, which rose 3.4% over the 12 months through July. Historically, the index has beaten inflation in 16 of the past 20 calendar years, according to The Kobeissi Letter. The four years of failure were 2008, 2011, 2018, and 2022, with three of them showing consumer price increases below 3%. In 2025, 13.5 of the index’s 17.9 percentage points of return came from higher earnings per share, driven by AI infrastructure stocks. Nvidia dominates this trend with gains above 13,000%, while Goldman Sachs forecasts that AI beneficiaries will supply roughly half of the index’s earnings growth.
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