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The month of May was kind to the U.S. labor markets, whether you studied Federal nonfarm payrolls, which were up +172K in May, or the ADP report.
In June, 2026 – Private sector employment increased by +122K jobs in May and pay was up +4.4% year-over-year according to the May ADP National Employment Report® produced by ADP in collaboration with the Stanford Digital Economy Lab.
"Hiring was more broad-based in May than we've seen in the last few years. The labor market continues to show sustained momentum going into the summer hiring season." – Dr. Nela Richardson, Chief Economist, ADP
From our May 22nd, 2026 research --
Zacks estimates on S&P500 stocks offer solid 2026 EPS growth – An EPS lift gets noted across Q1, Q2, Q3 & Q4.
Lifted impressively by “AI” capital expenditures, done largely by the “Mag 7” monster tech companies, and then, a host of others…
A. Zacks quarterly EPS and Revenue growth rates across 2026.
For Q1-26, S&P500 EPS growth looks for +25.0%; revenue should grow +11.2%
For Q2-26, S&P500 EPS growth looks for +21.0%; revenue should grow +10.3%
For Q3-26, S&P500 EPS growth looks for +18.1%; revenue should grow +9.1%
For Q4-26, S&P500 EPS growth looks for +20.0%; revenue should grow +8.8%
B. Zacks quarterly EPS and Revenue growths rates for 2025.
For Q1-25, S&P500 EPS grew +12.8%; revenue grew +4.9%
For Q2-25, S&P500 EPS grew +12.7%; revenue grew +6.3%
For Q3-25, S&P500 EPS grew +15.8%; revenue grew +8.2%
For Q4-25, S&P500 EPS grew +14.1%; revenue grew +9.0%
C. Annual EPS growth
Zacks expects S&P500 EPS growth from +13% to +17% annually, over three years.
Zacks expects +16.0% y/y EPS growth in 2028 (as of May 22nd, 2026)
Zacks expects +16.7% y/y EPS growth in 2027
Zacks expects +19.5% y/y EPS growth in 2026 for S&P500 companies
Zacks marked +13.4% y/y EPS growth in 2025 for S&P500 companies
II. Zacks June 2026 Sector/Industry/Company Telescope
May 29th, 2026 data showed Info Tech stayed dominant at Very Attractive.
Computer-Office Equipment and Electronics led, though. Semis ranked just OK this month.
Energy stayed Very Attractive rating; Iran remains a major oil price catalyst. Industrials rose to Very Attractive from Market Weight.
Communication Services fell to Attractive from Very Attractive. “AI” Telco Equipment group rank high, again.
View the Zacks #1 Rank List
A Steady U.S. Economy, Strong EPS Growth: Zacks JUNE Strategy
The following is an excerpt from Zacks Chief Strategist John Blank’s full Jun Market Strategy report To access the full PDF, click here.
I. Underlying U.S. macro fundamentals?
The month of May was kind to the U.S. labor markets, whether you studied Federal nonfarm payrolls, which were up +172K in May, or the ADP report.
In June, 2026 – Private sector employment increased by +122K jobs in May and pay was up +4.4% year-over-year according to the May ADP National Employment Report® produced by ADP in collaboration with the Stanford Digital Economy Lab.
"Hiring was more broad-based in May than we've seen in the last few years. The labor market continues to show sustained momentum going into the summer hiring season." – Dr. Nela Richardson, Chief Economist, ADP
From our May 22nd, 2026 research --
Zacks estimates on S&P500 stocks offer solid 2026 EPS growth – An EPS lift gets noted across Q1, Q2, Q3 & Q4.
Lifted impressively by “AI” capital expenditures, done largely by the “Mag 7” monster tech companies, and then, a host of others…
A. Zacks quarterly EPS and Revenue growth rates across 2026.
B. Zacks quarterly EPS and Revenue growths rates for 2025.
C. Annual EPS growth
Zacks expects S&P500 EPS growth from +13% to +17% annually, over three years.
II. Zacks June 2026 Sector/Industry/Company Telescope
May 29th, 2026 data showed Info Tech stayed dominant at Very Attractive.
Computer-Office Equipment and Electronics led, though. Semis ranked just OK this month.
Energy stayed Very Attractive rating; Iran remains a major oil price catalyst.
Industrials rose to Very Attractive from Market Weight.
Communication Services fell to Attractive from Very Attractive. “AI” Telco Equipment group rank high, again.
Financials stayed Market Weight. Consumer Staples stayed Market Weight.
Consumer Discretionary stayed at Market Weight. Health Care stayed on a Market Weight group too.
Utilities fell to Unattractive. Materials remain Unattractive.
(1) Info Tech stays Very Attractive. Computer-Office Equipment and Electronics led.
Zacks #1 Rank (STRONG BUY): Micron (MU - Free Report)
(2) Energy stayed Very Attractive. Oil & Gas Miscellaneous, Oil Integrated, and Energy-Alternates led.
Zacks #1 Rank (STRONG BUY): Chevron (CVX - Free Report)
(3) Industrials rose to Very Attractive from Market Weight. Construction-Building Services, Machinery, and Pollution Control look best.
Zacks #1 Rank (STRONG BUY): Quanta Services (PWR - Free Report)
(4) Communications Services stayed Attractive. Telco Equipment stayed strong, again. It is an “AI” group.
(5) Financials stayed Market Weight. Insurance, Banks-Major, & Real Estate look best.
(6) Health Care stayed at Market Weight. Medical Care and Drugs looked best.
(7) Consumer Staples stayed at Market Weight from Unattractive. Agri-business and Beverages looked the best.
(8) Consumer Discretionary stayed at Market Weight. Publishing looked the best.
(9) Utilities fell to Unattractive from Attractive. Utility-Water Supply looked best.
(10) Materials stayed Unattractive. Steel looked best.
III. Conclusion
Three strong S&P500 sectors lift this stock market’s fundamentals: Info Tech, Energy, and Industrials.
Is that enough, to sustain this bull market? One is notably global energy shock related.
Be wary of that.
Enjoy the rest of my June 2026 Zacks Market Strategy report!
Warm regards,
John Blank, PhD.
Zacks Chief Equity Strategist and Economist