Fourth quarter earnings season has largely wrapped up and the S&P 500 Index is on track to post its first year-over-year decline in EPS since the COVID-19 lockdowns of 2020. Revenues did grow as inflation helped companies post solid top line results (revenue is reported in nominal terms). Margins, on the other hand, came under pressure as expenses outgrew revenue leading to the earnings shortfall. Tech+ was a noticeable laggard, particularly e-commerce and communication services names. Without the Tech+ headwinds, the S&P 500 Index would be on track to grow EPS about 5% in Q4.

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