S&P 500 Financials Sector Earnings Preview: Q2 2026

The Financials sector will be a focus for the market during the upcoming week, as more than 50% of the S&P 500 companies (17 out of 31) that are scheduled to report earnings for the second quarter over this period are part of this sector, including Bank of America, Citigroup, Goldman Sachs, JPMorgan Chase, Morgan Stanley, Travelers Companies, and Wells Fargo. The Financials sector is predicted to report the eighth-highest year-over-year earnings growth rate of all eleven sectors for Q2 at 6.6%. This growth rate is above expectations for earnings growth of 5.2% at the start of the quarter (March 31).

At the industry level, three of the five industries in the sector are expected to report year-over-year earnings growth: Capital Markets, Banks, and Financial Services.

The Capital Markets industry is expected to report the highest earnings growth rate in the sector at 15%. Within the Capital Markets industry, two of the three sub-industries are projected to report (year-over-year) earnings growth: Investment Banking & Brokerage (30%) and Asset Management & Custody Banks (16%). On the other hand, the Financial Exchanges & Data (-10%) is the only sub-industry in the industry predicted to report a year-over-year decline in earnings.

The Banks industry is expected to report the second-highest earnings growth rate in the sector at 11%. Within this industry, both sub-industries are projected to report (year-over-year) double-digit earnings growth: Regional Banks (17%) and Diversified Banks (11%).

The Financial Services industry is expected to report the third-highest earnings growth rate in the sector at 3%. Within this industry, all three sub-industries are projected to report year-over-year earnings growth: Diversified Financial Services (15%), Transaction & Payment Processing Services (4%), and Multi-Sector Holdings (1%).

On the other hand, two industries are expected to report a year-over-year decline in earnings: Consumer Finance and Insurance.

The Consumer Finance industry is expected to report the largest (year-over-year) earnings decline in the sector at -10%. At the company level, 2 of the 3 companies (Synchrony Financial and Capital One Financial) in the industry are projected to report a year-over-year decline in EPS. On the other hand, American Express is the only company in the industry projected to report year-over-year growth in EPS.

The Insurance industry is expected to report the second-largest (year-over-year) earnings decline in the sector at -3%. Within the Insurance industry, 2 of the 4 sub-industries are projected to report year-over-year earnings growth: Insurance Brokers (9%) and Life & Health Insurance (1%). On the other hand, 2 of the 4 sub-industries are projected to report a year-over-year earnings decline: Reinsurance (-22%) and Property & Casualty Insurance (-6%).

Stewart Johnson, Associate Director for Deep Sector Content, highlighted key themes to watch in the Insurance industry during this earnings season:

Insurance companies will begin reporting 2Q earnings towards the end of the month. The companies operated in a mixed macro environment, so results are expected to vary based on the company’s specific business profile.

For example, P&C companies continued to battle core inflation throughout the quarter. That likely pushed up the cost of labor and materials to settle policyholder claim costs, which drives combined ratios up and earnings down.

Auto insurers are the exception to inflation and higher combined ratios. Despite higher costs for labor and replacement parts, companies such as PGR and ALL likely benefited from fewer claims to a greater degree than the other insurance sectors as persistently higher gas prices decreased miles driven and accident-related claims.

Life insurance companies, especially those earning fees from assets under management (e.g., PRU and MET) enjoyed a tailwind from strong equity markets. Those firms should see a bump in investment income driven by higher AUM-related fees and increased opportunities to realize investment gains.

For more commentary and analysis on the insurance industry, please see Stewart’s articles on the FactSet Insight blog.

Looking ahead, analysts are predicting double-digit earnings growth for the Financials sector in 2 of the next 4 quarters. For Q3 2026 through Q2 2027, analysts are projecting earnings growth rates of 2.3%, 10.7%, 7.3%, and 12.1%, respectively. 

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