Investing.com -- Global equities are trading at highs even as the Straits of Hormuz remain closed, and the growth-inflation mix deteriorates, a situation Goldman Sachs says is explained primarily by corporate earnings.

In a note from analyst Peter Oppenheimer, Goldman said "earnings growth is robust," driven by nominal global GDP growth estimated at 5.9% this year, up from 4.7% in 2025.

Technology and energy have been the two dominant forces, with bottom-up consensus estimates for S&P 500 earnings per share in 2026 and 2027 each revised up by 8 percentage points so far this year, fueled largely by rising expectations for artificial intelligence capital expenditure and higher energy prices.

The rally, however, is heavily concentrated. The S&P 500 has returned approximately 10% year-to-date in 2026, with technology, media and telecom accounting for 85% of that gain.

Korea, a direct beneficiary of the chip boom, has surged nearly 80% this year.

Goldman warned that near-term risks are building. Its Risk Appetite Indicator climbed above 1.1 last week, reaching its 99th percentile since 1991.

Retail trading volumes have risen 28% since mid-April. Equity risk premia have compressed as bond yields rise, and Goldman cautioned that "if oil disruptions continue into the second half of this year and inflation expectations rise further, there is a real risk of a speed bump for equity markets."

The bank also flagged sharp moves in bond yields as a potential correction trigger, noting that surging government borrowing is adding upward pressure on longer-dated yields globally.