Andrew Beatty, of LPL Financial, consults with GenWealth as their Chief Investment Officer.
Markets have always had ups and downs. But every so often, the headlines lean toward the downs while stocks keep delivering the ups. We appear to be in one of those stretches right now. Stocks are holding onto strong 2026 returns, and the Nasdaq just set a fresh all-time high this week, even as the list of investor concerns grows longer.
That list, often called the “wall of worry,” currently includes geopolitical conflict, rising interest rates, and questions about artificial intelligence (AI). Any one of these could spark volatility, though none has done so recently. So what is helping support stocks, and should we expect it to continue?
What Is Working in the Market’s Favor
Corporate fundamentals remain supportive. S&P 500 earnings are still growing rapidly and could approach 40% in the third quarter once all the numbers are in. Large tech companies have been putting their cash flows toward building data centers, but the broader cash flow outlook remains healthy.
The economy has also shown resilience. Strong household balance sheets help, and so do the low, fixed-rate mortgages many homeowners locked in during the pandemic, which have made consumers less sensitive to higher rates.
The AI buildout is also creating opportunities beyond the companies building the technology, often called hyperscalers. That spending is supporting demand for semiconductors, memory, and infrastructure equipment.
The Risks Worth Watching
There are always real risks, and today is no exception. For markets, the biggest one right now may be rising interest rates. Higher Treasury yields raise borrowing costs and can pressure stock valuations, which increases the odds of short-term pullbacks and can limit upside potential.
Several forces are pushing rates higher and may not ease soon: high oil prices, Federal Reserve rate hikes, solid economic growth, budget pressures in the U.S. and Europe, and corporate borrowing to fund the AI buildout.
Before acting on the urge to sell stocks, though, a little perspective helps. 5% Treasury yields were considered normal before the Global Financial Crisis, back before “quantitative easing” became a household term. The 10-year Treasury yield spent much of the late 1990s near 6%.
Other risks include:
The need for companies making large AI investments to show tangible productivity and profit gains. Energy disruptions in the Middle East, which could keep inflation elevated and weigh on confidence. Election-related uncertainty, which could cause bouts of volatility, even though markets have historically tended to handle political gridlock well.
What This Means for Investors
From a portfolio management perspective, LPL Financial continues to recommend that investors emphasize diversification by balancing AI beneficiaries, attractive income opportunities, and commodity-linked exposures that can help hedge against broader economic risks.
The uncertainties are genuine. But so is the foundation underneath this market: solid corporate profitability and steady economic growth, both of which point toward staying the course.
If you have questions about how today’s market environment fits into your own financial plan, our team at GenWealth Financial Advisors is always here to talk it through.
This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Any economic forecasts set forth may not develop as predicted and are subject to change.
References to markets, asset classes, and sectors are generally regarding the corresponding market index. Indexes are unmanaged statistical composites and cannot be invested into directly. Index performance is not indicative of the performance of any investment and do not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.
LPL Financial does not offer access to or purchase of initial public offerings (IPOs).
This material is intended for informational and educational purposes only and does not constitute investment research, a research report, or a recommendation regarding any specific security or issuer.
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services. Any securities or company names discussed in this material for illustrative purposes should not be construed as investment advice or recommendations.
All data is provided as of October 7, 2026.
All index data from FactSet.
The Standard & Poor’s 500 Index (S&P500) is a capitalization-weighted index of 500 stocks designed to measure performance of the broad domestic economy through changes in the aggregate market value of 500 stocks representing all major industries.
The NASDAQ Composite Index measures all NASDAQ domestic and non-U.S. based common stocks listed on The NASDAQ Stock Market. The market value, the last sale price multiplied by total shares outstanding, is calculated throughout the trading day, and is related to the total value of the Index.
The fast price swings in commodities will result in significant volatility in an investor’s holdings. Commodities include increased risks, such as political, economic, and currency instability, and may not be suitable for all investors.
Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.
There is no guarantee that a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.
Past performance does not guarantee future results.
Asset allocation does not ensure a profit or protect against a loss.
This research material was prepared by LPL Financial, LLC.
