There’s a good reason stocks continue to hit all-time highs—most companies are beating expectations, JPMorgan says

• Why are stocks hitting record highs? Because the vast majority of companies are beating earnings and revenue expectations. With inflation contained and a Fed rate cut likely in September, investors remain optimistic. However, some analysts warn that overvalued tech stocks may signal a potential market correction. Global markets mostly rose today, while Bitcoin declined.

S&P 500 futures moved up this morning after the index closed at another all-time high yesterday, hitting 6,445.76. With inflation largely under control, investors appear to be assuming that the U.S. Federal Reserve will deliver a 0.25% interest rate cut in September. Some analysts think that if the labor market continues to slow down, the cut might be 0.5%.

Regardless, the hope of incoming cheaper money is good for stocks.

Maybe … too good for stocks?

Some analysts think the market is heavily overvalued and thus due for a correction. The S&P’s value is heavily driven by tech stocks, according to Apollo Management, and on one measure, those stocks are more overvalued today than their equivalents were in the dot-com bubble of the late 1990s. That bubble burst in 2000, and the index did not regain a new high until 2006.

But there’s another reason that traders continue to favor stocks. The fact is, companies are doing really well, according to JPMorgan. Seventy-six percent of the companies reporting their Q2 results so far have beaten earnings estimates, and 77% have beaten revenue estimates, according to Dubravko Lakos-Bujas. Sixty-two percent have been double-beats.

Eighty-nine percent of the S&P 500 has reported Q2 earnings so far, and their average revenue growth is 6.1% over the prior year. Their net income growth is 10.9%, Lakos-Bujas says.

With companies overperforming versus expectations, and a September rate cut looking inevitable, it is not surprising that investors are buying into the action.

Here’s a snapshot of the action prior to the opening bell in New York:

• S&P 500 futures ticked up 0.2% this morning, premarket, after the index closed up 1.13% yesterday.

• STOXX Europe 600 was up 0.49% in early trading.

• The U.K.’s FTSE 100 was up 0.16% in early trading.

• Japan’s Nikkei 225 was up 1.3%, another all-time high.

• China’s CSI 300 was up 0.79%.

• The South Korea KOSPI was up 1.08%.

• India’s Nifty 50 was up 0.69%.

• Bitcoin declined to $119.9K.

This story was originally featured on Fortune.com