Four weeks, four tests: a semiconductor rout, a capital spending reckoning, a bout of "beat fatigue," and a midterm election. Across the four latest Belski Briefs1, Brian Belski, CEO and Chief Investment Officer of Humilis Investment Strategies, and his team (Nicholas Roccanova, Sooyun Hong, Ryan Edwards and Cole Jackson) meet each one with the same answer. Earnings, not headlines, set the direction.
Beneath the Surface
The October 19 brief opens with an index that looks worse than the market underneath it. The S&P 500 falls 1.95%, its worst week since June, as the SOX drops for eight consecutive sessions, tying its longest losing streak since 2006. Yet the equal-weighted S&P 500 finishes higher, beating its cap-weighted counterpart by more than 2%, its second-best relative week in three years. Consumer Staples, Energy and Health Care each gain between 3% and 5%.
"Importantly, investors did not exit the market; they repositioned within it," the team writes.
To be clear, the team does not read the Technology selloff as a fundamental shift. It points to higher yields, a hotter-than-expected inflation report and questions about how AI spending will be financed, while analysts expect Technology earnings to grow 64% in Q3, up from 57% on June 30. The verdict: "a market that can absorb a sharp decline in its leadership group while the average stock moves higher is a healthy one."
Show Me the Returns
One week later, the tone sharpens. "The days when the Magnificent Seven moved in the same direction appear to be over," Belski and team write. Their chart makes the point: year to date, Apple is up 27.9% while Meta is down 2.7% and Tesla is down 17.2%. Four hyperscalers plan nearly $750 billion in 2026 capital spending, and the market's reaction to Meta shows investors now want evidence of returns.
"The market continues to offer opportunities, but leadership needs to be earned."
That is the divergence worth noting. On October 19, breadth is the story. On October 26, selectivity is. The thread connecting them is that, in the team's words, "the index alone tells only part of the story."
A Higher Bar, Not a Weaker Engine
By November 2, with 60% of S&P 500 companies reported, Q3 earnings are on pace to grow more than 30%, ahead of the 29.1% forecast at the end of September and the third consecutive quarter above 25%. All 11 sectors are positioned for year-over-year growth, a first this year.
Skeptics point to the size of the beats. While 82% of companies top estimates, the aggregate beat shrinks to 1.9%, against a five-year average of 7.5%. The team's reply is direct: "We believe this dynamic reflects a higher bar rather than weaker fundamentals." Expected 2026 earnings growth has more than doubled since January to 32.6%, and analysts project 28% growth in Q4.
Ballots and Multiples
The November 9 brief arrives with the midterms and the volatility they bring. Belski's position is plain: "investment decisions should not be dictated by politics or the party in power."
The numbers back the composure. Blended Q3 growth stands at 31.4%, with full-year 2026 growth expected to reach 33.3%. Meanwhile, the forward 12-month P/E compresses to 17.7, below its five-year average of 19.8 and ten-year average of 19.1.
The team is honest about the limits. "We recognize earnings growth cannot maintain this pace indefinitely," they write, before adding: "Slower growth does not mean declining earnings." Volatility could persist as investors digest the election and debate data center spending. The view stated earlier this year, "Volatility Is the Price of Admission," stands.
The Bottom Line
Four briefs, one discipline. Rotation, scrutiny, a higher bar and an election all produce volatility. None, in the team's reading, changes the earnings trajectory. The opportunity, they argue, belongs to "patient, long term investors."
Five Key Takeaways for Advisors and Investors
- Look past the headline index. Equal weight rose during the S&P 500's worst week since June. Breadth tells a different story.
- Treat mega-cap technology as individual businesses. With year-to-date returns running from 27.9% to negative 17.2%, the Magnificent Seven is no longer one trade.
- Smaller beats are not weaker earnings. A 1.9% aggregate beat reflects estimates that have more than doubled since January.
- Keep politics out of the portfolio. The team views election-related weakness "as an opportunity rather than a reason to step away."
- Watch valuation alongside growth. A 17.7 forward P/E sits below its five-year and ten-year averages while earnings grow more than 30%.
Footnote:
1 Belski, Brian G., et al. Belski Briefs. Humilis Investment Strategies, 19 Oct., 26 Oct., 2 Nov., and 9 Nov. 2026, https://humilisinv.com/belski-briefs/.
