The first half of 2026 brought plenty of volatility, particularly in memory stocks, while Wall Street remained distracted by short sellers and geopolitical tensions.
As investors look ahead to the second half of the year, here are five predictions to watch.
My highest-confidence prediction for the second half of 2026 is that earnings will continue to accelerate. A lot of that has to do with year-over-year comparisons, strong order backlogs, and rising investor confidence.
Earnings season is judgment day, and I go into every earnings season locked and loaded because Wall Street does not pay attention to earnings the way I do. When earnings come out, investors assess them, but they are often distracted by other things, focusing only on qualitative analysis rather than combining it with a quantitative analysis of trading activity.
Earnings strength is expected to be concentrated in three sectors. Energy-related stocks are forecasted to post the strongest earnings, followed by information technology and semiconductors, then material stocks.
Only three of the 11 S&P 500 sectors are forecast to post stronger second-quarter earnings than the overall S&P 500, so we remain in a relatively narrow stock market environment.
In energy, recommended names include Okeanis Eco Tankers (ECO), International Seaways (INSW), Teekay Tankers (TNK), HF Sinclair (DINO), Phillips 66 (PSX), Cenovus Energy (CVE), and Suncor Energy (SU).
Next up, information technology, including all the data center-related and semiconductor stocks such as Nvidia (NVDA), Advanced Micro Devices (AMD), Micron Technology (MU), Seagate Technology (STX), Palantir Technologies (PLTR), AppLovin (APP), Bloom Energy (BE), GE Vernova (GEV), Comfort Systems USA (FIX), Quanta Services (PWR), and Ciena (CIEN).
Lastly is materials, with recommended names including Carpenter Technology (CRS) and Howmet Aerospace (HWM).
I suspect we will see the biggest gains in energy.
Related: Citi strategist flags rare setup for earnings season
Memory stocks have been a rollercoaster, but in my opinion, all the memory stocks, led by Micron Technology (MU), SanDisk (SNDK) and Seagate Technology (STX), are great near-term buys.
There is a lot to be excited about. South Korean memory company SK Hynix (SKHY) had the second-largest IPO ever (after SpaceX), raising $28 billion.
Meanwhile, Micron Technology announced it is accelerating its planned U.S. fab and technology investments and is increasing its expected spending forecast to more than $250 billion through 2035, driven by surging AI-related demand for memory. The company anticipates its increase in U.S. investments will support its long-term goal of producing 40% of its DRAM (dynamic random-access memory) in the U.S.
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