RBC's Markets in Motion
Our regular podcast from Lori Calvasina, Head of US Equity Strategy, that brings a fresh perspective and nuanced, data driven view on the forces shaping U.S. equity markets. Disclaimer: https://www.rbccm.com/en/policies-disclaimers.page
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Midterms On Our Mind
<p>The big things you need to know:</p>First, we took a look back at equity market and sector performance in 2H18 and 2H22, around the last two midterm elections. Conditions were choppy with two distinct drawdowns interrupted by a meaningful rally. Consumer Staples and Health Care outperformed during the drawdowns while Financials, Industrials, and Materials outperformed in the rebounds.Second, other things that jump out in our updates this week include shifts we’re seeing in our factor work, descriptions of a cautious consumer in our earnings call transcript analysis, the tendency of the stock market to perform we...
The Lowdown From Down Under
<p >The big things you need to know:</p>First, takeaways from last week’s meetings with Australia-based investors, in which our conversations focused on inflation / interest rates / the Fed, the US midterm elections, and the rotation trade.Second, key big-picture themes in last week’s S&P 500 earnings calls included a cautiously optimistic tone among companies, consumer descriptions that seemed a little more complicated than usual, a renewed conversation on Iran war impacts, heightened attention to inflation pressures, and increasingly specific commentary from non-Tech companies about AI impacts.Third, other things that jump out in our weekly updates include the...
Valuation Opportunities Unlocking, Fed Transitions Can Be Tough For Stocks
<p>The big things you need to know:</p>First, valuation opportunity is opening up in the US equity market from a variety of perspectives.Second, in the aftermath of Wednesday’s Fed meeting, we highlight how the stock market tends to experience choppy performance in the first few months under a new Fed Chair.Third, other things that jump out in our updates this week include the return of high EPS quality outperformance as a factor in both the S&P 500 and Russell 2000, the modest uptick in stock market optimism in the Conference Board consumer survey that was out th...
Muddy Waters
<p>The big things you need to know:</p>First, the stats for 2Q26 reporting season have continued to come in mixed, arguing for selectivity rather than a leadership rotation, in our view.Second, last week’s earnings commentary from S&P 500 companies reiterated the themes of resiliency and AI tailwinds, but didn’t give us much insight on how to think about recent war developments.Third, we review how we’re thinking about the role of the retail investor in today’s US equity market, which differs in some respects from the past, and how we’re monitoring risks on this fr...
Mixed EPS Stats, Cautiously Optimistic Commentary
<p>The big things you need to know:</p>The big things you need to know: First, the early stats from 2Q26 reporting season look a little mixed as reporting season kicks into high gear.Second, early earnings commentary from the companies that reported over the past week highlights a cautiously optimistic tone, consumer resiliency, and complicated AI impacts.Third, other things that jumped out in our latest updates include further evidence of stabilizing sentiment on the NFIB and University of Michigan consumer sentiment surveys (which have encouraged the rotation trade) and evidence of weaker flows to US equities (which...
S&P 500 Sector Recommendation Shuffle
<p>The big things you need to know:</p>First, we are making several changes to our S&P 500 sector views with upgrades to Tech to overweight and Consumer Discretionary to market weight, alongside downgrades of Communication Services to market weight and Utilities to underweight.Second, the expected growth rate for 2Q26 S&P 500 EPS has continued to drift up ahead of reporting season, but trends in beat rates and EPS revisions have been mixed.Third, on our broader outlook we’re on guard for a shift back into US and mega cap Growth leadership.<br/>
June Survey Results Reveal Optimism, Not Euphoria, Heading Into 2H26
<p>The big things you need to know:</p>First, across the globe our analysts are constructive on performance over the next 6-12 months and see attractive valuations in the industries they cover.Second, Europe and Canada captured the most optimistic performance outlooks among our four coverage regions, but the US was not far behind.Third, our Canadian and US analysts expressed a favorable view of their own respective domestic policy backdrops. On the US midterm elections, our US analysts had a slightly constructive tilt on performance in a Republican sweep scenario, a slightly negative tilt on performance in a...
Mid-Year Outlook Update
<p>The big things you need to know:</p>First, we are lifting our 12-month S&P 500 price target to 8,150 from 7,900. We also think the recent outperformance of non-US developed markets and value could last a bit longer but ultimately expect equity market leadership to return to the US and big cap growth after the recent valuation problem is resolved.Second, we run through our thoughts on the upcoming reporting season, noting that the bar seems high from a data perspective.Third, the latest Duke CFO survey pointed to a slight downtick on economic optimism but a slight uptick on...
Down the Valuation Rabbit Hole
<p>Two big things you need to know:</p>First, forward P/Es have generally been de-frothed, but haven’t looked deeply compelling for the major US indices.Second, the valuation case for the broadening trade still has some room (Small Caps, certain cyclical sectors, non-US developed market equities), but requires close monitoring.<br/><p></p>
The Time is Now – We Need Your Help
<p>It’s been a year, and it’s only June. We built a framework to help investors navigate the fear and stuck with our constructive longer-term view. </p><p>If you’ve found our research, and this podcast, helpful, we’d appreciate your vote in the Extel (formerly II) All America Research survey. </p><p>Voting is open and closes this Friday, June 12th – please cast your vote now. </p><p>Here is a one-minute video explaining why we think we’ve earned it this year. </p><p>To vote go to: </p>https://www.extelinsights.com/support/voting-helpAll-America ResearchMacr...
