Is the market rising on earnings or on hope?
A stock market can rise because companies earn more or because investors are willing to pay more for the same earnings. Gains built on profits tend to last; gains built on a rising P/E depend on optimism holding up.
Updated Oct 9, 2026
Mostly earnings
Over the past year the S&P 500 rose 16% while its earnings grew 34%, so the P/E fell from 30.5x to 26.3x. The whole gain came from higher profits, and investors are paying less for each dollar of them than a year ago.
Price against earnings
The one-year change in the S&P 500’s price and in its earnings, week by week. Select a period above to see its split.
Sector by sector, past year
Each sector’s market value change split into earnings growth and the change in its P/E, holding the same companies at both ends. Select a column to sort.
| Sector | From earnings | Value, 1Y | Earnings, 1Y | P/E change | P/E now |
|---|---|---|---|---|---|
Communication Services 16 companies | 100Mostly earnings | +13% | +42% | −20% | 18.4x |
Consumer Discretionary 45 companies | 100Mostly earnings | 0% | +32% | −24% | 28.3x |
Financials 74 companies | 100Mostly earnings | 0% | +22% | −18% | 16.1x |
Industrials 76 companies | 100Mostly earnings | +7% | +16% | −7% | 26.8x |
Information Technology 67 companies | 100Mostly earnings | +26% | +75% | −28% | 34.1x |
Materials 24 companies | 100Mostly earnings | +11% | +18% | −6% | 30.9x |
Real Estate 29 companies | 100Mostly earnings | +6% | +69% | −37% | 34.5x |
Utilities 31 companies | 100Mostly earnings | −6% | +14% | −18% | 18.8x |
Consumer Staples 34 companies | 85Mostly earnings | +8% | +7% | +1% | 30.1x |
Energy 21 companies | 85Mostly earnings | +48% | +40% | +6% | 18.3x |
Health Care 57 companies | 0Mostly hope | +16% | −11% | +30% | 33.9x |
How to read this page
How it’s measured. The S&P 500’s price change split into the change in its total earnings and the change in its P/E, using trailing twelve-month net income for the companies in the index each day. The score is the share of the gain that came from earnings.
Sources. Daily prices and company financial statements from Financial Modeling Prep.
Earnings are as reported, including one-off items, so a big write-down or gain at a large company can swing the split. Prices exclude dividends.
A rising P/E is not a warning on its own; it often happens when investors expect earnings to grow. It does mean more of the return depends on that expectation being met.
This page is information, not investment advice. About our data and methods ›