There is normally a pretty nice correlation between the yearly percentage change in equities and the yearly change in earnings. And S&P 500 pricing is now indicating that markets expects earnings to show further gains in 2025.

We know that equity positioning is turning very bullish, while our growth models suggest that growth is not outright booming. Are there reasons to be cautious here?

Chart: S&P 500 is expecting further earnings momentum in 2025