What resilient S&P 500 earnings mean for South African investors

From South Africa, it is tempting to treat global equities as a single trade: a view on the rand, the Fed, or the next geopolitical shock. But the discipline that matters most is more boring and more powerful: staying invested in businesses whose earnings can compound through the cycle. Over the past two months, the S&P 500 has offered a case study in that resilience.

Equity prices may wobble around events, but earnings expectations tend to be the market’s anchor. When forward earnings rise, it becomes harder to argue that the rally is “just sentiment”. In our view, that is the key message for South African investors deciding how much offshore equity exposure to carry, and how to think about concentration risk in a world dominated by a handful of US mega-caps.

Earnings: the market’s shock absorber

The most useful datapoint in our current discussion is not where the index traded on any given day, but what analysts did with their profit forecasts. Between 2 March and 30 April 2026, S&P 500 forward earnings per share (EPS) rose from $315.38 to $328.45 — an upgrade of $13.07, or just over 4% in two months.

That pace of revision matters because it highlights two realities at the same time. First, US corporates continue to show pricing power, cost discipline and balance-sheet flexibility. Second, the index-level strength can still be “top-heavy”: a relatively small set of companies can drive a meaningful share of the upgrades, which has implications for how investors build global portfolios.

A handful of names contributed disproportionately to the change in forecast index EPS. This is not “good” or “bad” on its own — it is simply a reminder that buying “the S&P” is, increasingly, also buying exposure to specific profit pools (semiconductors, platform technology, US financials and selected energy).

The snapshot below illustrates how six companies contributed to the forward EPS upgrade, based on their earnings revisions and market capitalisation weights.

Table: Contribution to S&P 500 forward EPS upgrades (March–April 2026)

It’s interesting to note that only one of these companies, Nvidia, that drove the upgrade is part of the so called Magnificent seven. This means that in the short term at least some of the positive earnings momentum is being generated outside of that narrow group.

The S&P 500 is not “America” — it is more than half of the world’s equity market. This one statistic helps explain why South Africans keep circling back to the S&P 500 - it has become the centre of gravity of listed equities.

What it means for South African investors

Bottom line: don’t confuse headlines with fundamentals. The message from the past two months is not that risk has disappeared — it is that earnings forecasts which tend to drive markets, which are always forward looking, can be remarkably resilient even amid heightened geopolitical risk. For South African investors, this supports the case for maintaining strategic exposure to global equities, while being clear-eyed about two realities: the S&P 500’s outsized role in world markets, and the concentration that comes with it. If you can separate the currency noise from the earnings signal, and build a portfolio that is diversified by region, sector and style (not just by ticker symbol), offshore equities serve as both a growth engine and a risk-management tool over time. DM

For information on Laurium’s fund offering, please contact ir@lauriumcapital.com or visit www.lauriumcapital.com.

Laurium Capital is an authorised financial services provider (FSP 34142).

This article is published for information purposes and does not constitute financial advice. Past performance is not necessarily a guide to future performance. Investors should consider their individual circumstances and seek appropriate professional advice.