HSBC believes global equities can continue to demonstrate resilience despite rising bond yields. The S&P 500 index’s forward P/E ratio has fallen 16.5 percent since the end of 2025.
The bank expects a further 50-basis-point rise in the US 10-year yield to pressure valuations by 4.3 percent.
At the same time, the earnings season is expected to support the stock market. Consensus expects 29 percent earnings growth in the third quarter. HSBC remains positive on AI-related stocks, particularly major cloud providers.
