Let’s face it, folks, markets are like rollercoasters — some days you’re riding high, and others, you’re holding on for dear life. Right now, we’re seeing some wild swings, and it’s all because of a perfect storm of factors: recession fears, pre-election jitters, and some good ol’ profit-taking as investors make room for new stock issues. But here’s the silver lining — U.S. corporate earnings have been surprisingly strong, with every sector outperforming expectations in Q2. Earnings growth hit 13%, which blew past the 10% consensus. You see, despite all the doom and gloom headlines, businesses are holding up just fine.

What’s driving these earnings? AI. That’s right, artificial intelligence is reshaping industries faster than you can say “machine learning.” While tech is still leading the way, we’re seeing earnings growth spread to other sectors too. Energy, utilities, real estate — they’re all jumping on the AI train, providing the critical infrastructure needed for this revolution. And guess what? The ride is just beginning.

But here’s where things get tricky: Sentiment around AI is starting to shift. Some investors are scratching their heads, wondering if we’re spending too much too soon. So, it’s time to fine-tune your portfolio. Keep an eye on companies that are benefiting from AI in the early stages, and don’t be afraid to diversify beyond the big tech names.

And hey, while U.S. equities are still looking strong, you might want to rethink that Japanese equity overweight. A stronger yen and some mixed signals from the Bank of Japan are giving investors pause. But over here in the U.S., don’t be too swayed by recession fears. The job market is cooling, sure, but it’s not collapsing. Wages are still on the rise, and inflation is easing — but don’t expect it to drop to 2% anytime soon.

Bottom line: AI is the future, and while there’s a lot of noise in the market right now, smart investors will stay the course. Keep your eyes on the prize, and don’t let a little market volatility shake you up.