Stock market today: Dow, S&P 500, Nasdaq soar on hopes Trump may dial back expected tariffs

It’s the final week of the first quarter and, as is typical, analysts have spent the past 12 weeks revising lower their earnings growth projections for the quarter.

For the S&P 500 (^GSPC), estimates for earnings growth have been cut by 4.4%, more than the five-year average of 3.3% and the 10-year average of 3.2%. The largest revisions have come in tariff-sensitive sectors like Consumer Discretionary (XLY) and Materials (XLB).

“Q1 earnings expectations have come down a lot, which sets up an important market turning point once companies start to release results,” DataTrek co-founder Nicholas Colas wrote in a research note Monday morning. “The bar is low enough, especially in tariff-sensitive groups, that companies should be able to beat expectations by an above-average amount.”

As Colas points out, given recent downgrades to the overall macro outlook this year, the looming question for investors is how much bleaker companies see their paths for the remainder of 2025.

“Our view is that companies will likely reduce their Q2 guidance, but not yet dampen expectations for the year as a whole,” Colas wrote. “That should help put a floor under stock prices during the upcoming Q1 earnings season.”