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IN THIS ISSUE: Earnings season, investing in your company, and evaluating your portfolio |
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THE HEADLINES
Feel the earnWhat’s happening: We may be in the midst of one of the strongest earnings seasons. Despite ongoing geopolitical uncertainty, nearly 85% of S&P 500®1 companies that have reported financial results so far have beaten estimates.2
Here’s why: Solid showings from several Magnificent 7 tech companies are pushing earnings growth to its highest since 2021.3
This could point to an uptick in demand for AI models and services. Some credit card and payment companies are reporting that consumer spending, possibly supported by higher tax refunds, may also be helping. Earnings wins have been seen in the industrials and materials sectors as well. (Psst … one Fidelity pro recently mentioned the industrials sector as one to watch, plus these 2 others). |
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What it means: An old adage claims investors may want to “sell in May and go away,” since the summer and early fall months are typically weaker than November to April. Beyond strong earnings, here are several reasons why you shouldn’t sell this year. |
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Results may varyWhat’s happening: The economy keeps sending mixed signals.
Here’s why: Today’s Consumer Price Index, which measures the cost of goods and services, showed that inflation ticked up to 3.8% in April, largely because of rising gas prices.4 This is the highest uptick since 2023.5
Despite that and consumer sentiment near record lows, consumer spending remains strong. In fact, gross domestic product (GDP), the value of all US-produced goods and services, rose by 2% in 2026’s first quarter.6 The job market is also staying resilient, with April’s jobs report showing more growth than expected. These are signs the economy is still chugging along.
What it means for you: Where things go next could depend on how long the Iran conflict continues, tying up oil shipments. While gas and airfare felt inflation first, analysts say higher prices could soon hit food, personal care, and medicine because their packaging requires plastics derived from oil and natural gases. Luckily, there are some things you can do to stop the squeeze. Learn
10 ways to beat inflation—for your wallet and investments. |
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Meet: marketWhat’s happening: Company stock plans (which may grant employees company stock as part of their compensation or allow workers to buy company stock at a discount) are introducing investing to millions of employees. According to Fidelity Investments’
Stock Plan Services participant research, 43% of participants first invested in stocks through their company’s stock plan, and 34% of those new investors invest beyond the plan.
Here’s why: Equity plans can provide an insulated space for employees to learn about investing and help them build investing habits.
What it means: Your company may offer an employee stock purchase plan (ESPP) with a possible discount on shares. Learn more about how employees can make the most of their awards. Not only could you potentially boost your bottom line and investing confidence, but you also may feel a stronger sense of ownership in the success of your company, as 64% of survey respondents reported.7
No ESPP but want to dip your toe in the stock market? Here’s how to get started. |
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HOW TO
Cut your 3 biggest costsYou’re probably shelling out too much for housing, driving, and food. These tips may help transform your budget. |
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QUICK Q
How should I evaluate my portfolio’s performance?If you’re a Fidelity customer, log in to your account and head to Positions under the Portfolio Summary page. This will give you an in-depth view of each security’s performance over a specific period. For an at-a-glance view of your whole portfolio’s performance, head to the Performance tab.
Your first instinct may be to look at the bottom line, but also pay attention to whether your investments perform in line with your strategy. For instance, an aggressive investor looking for growth should expect to see periods of large gains and losses aligned with market performance, while a more conservative investor would want to see less volatility. Be sure to review your portfolio over multiple timeframes, depending on your objectives and time horizon. Also, consider fees, taxes, and any contributions or withdrawals, as these can impact your true investment returns.
To make a meaningful comparison, check the returns of your stock, bond, and cash holdings against benchmark indexes. For US stocks you might consider the S&P 500® or Dow Jones US Total Stock Market IndexSM, which measure the performance of a broad range of US stocks.
Ideally, you want your returns to be close to but (hopefully) exceeding the appropriate benchmarks and exhibiting volatility consistent with or lower than those benchmarks. Returns that differ dramatically from the benchmarks—on either the high or low side—may indicate your portfolio needs a review to see what’s causing the difference. Just know many investors are in it for the long haul, so don’t let short-term performance weigh too heavily in your decision-making.
Need to give your portfolio a checkup? Check out this 4-step guide. |
