This Earnings Season's Biggest Beats Are Coming From Outside Tech
This earnings season, non-tech sectors like energy, utilities, and industrials are outperforming, showcasing significant earnings surprises. The struggle within the tech sector indicates a potential shift in investor focus, reflecting broader economic trends where traditional industries are proving resilient. This development merits close attention as it may influence positioning in the FX market, particularly if investors seek safer or more stable investments amidst volatility.
Where it sits in our coverage
Our consensus EUR/USD target sits at 1.075 (median across 8 firms), with Goldman at the upper bound (1.12) and BofA at the lower (1.04). Barrons' view aligns more closely with the upper third — JPMorgan shares that framing with a target of 1.10 for March 2026.
How firms align
Specifically, JPMorgan supports the bullish outlook with a target reflective of positive movements in industries outside tech. Conversely, BofA holds a more cautious stance, positioning at 1.04, which suggests they foresee potential challenges in the broader market beyond tech.
What the data shows
Forecast revisions indicate a tendency towards improved earnings expectations across non-tech sectors, which could shift market dynamics. For further insights, refer to /research/<slug> regarding sector performance correlations.
How firms align with this view
Aligned with the headline view
Contrary positioning
Key takeaways
- 01Energy and industrials are outperformers this earnings season.
- 02Look for reactions in the EUR/USD pair to sector performance shifts.
- 03March 2026 targets are pivotal with JPMorgan at 1.10 as a market catalyst.
Market implications
Next, watch the EUR/USD approach the 1.075 level, especially in light of upcoming economic data releases that may shift investor sentiment. Positioning may begin to favor sectors outside tech as earnings surprises continue to unfold.
Risks to this view
A reversal could occur if tech earnings surpass expectations significantly or if macroeconomic data surprises to the upside, raising concerns about inflation and interest rates. Such shifts could undermine the current trend favoring non-tech sectors.
Sentiment by currency
USD+EUR~JPY~GBP~Composite USD score: +0.35
Sources & References
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