RBC's Markets in Motion

The big things you need to know:

The big things you need to know:

The big things you need to know:

The big things you need to know:

First, the stock market is still experiencing a growth scare, in our view, where it is attempting to stabilize. We see more downside if recession is priced in.

Second, we review how the process of resetting EPS expectations has begun, and run though key themes from the early reporters and companies that have presented at conferences since the Rose Garden. Our overarching takeaway from our reading is that recession is not yet a foregone conclusion but also that US equities are not out of the woods.

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The big things you need to know:

The big things you need to know:

The big things you need to know:

The big things you need to know:

RBC’s Markets in Motion is the weekly podcast from Lori Calvasina, Head of US Equity Strategy at RBC Capital Markets, highlighting her latest views on the US equity market. This week, we bring you a special edition of the podcast, recorded live at the RBC Financial institutions conference on March 5th, 2025. Ben Fisher (US Equity Sales, Midwest & Macro Sales Specialist) moderates a discussion with Lori Calvasina (Head of US Equity Strategy) and Amy Wu Silverman (Derivatives Strategist) on their latest views on the US equity market outlook and what they’ve been hearing from investors.

The big things you need to know: First, we review our basic framework for thinking about drawdowns in US equities, a topic that’s been coming up in client meetings over the past few weeks, as investor uncertainty regarding the economy has increased. Second, we have refreshed the math behind our YE 2025 bear case of 5,775, specifically our valuation/EPS stress test. Third, we run through our latest updates on the vibes breakdown in the US, where investor sentiment has plunged to crisis lows on one key metric. Fourth, some of our work suggests opportunity is opening up in Small Ca...

The big things you need to know: First, we found more evidence of weakening investor and consumer vibes in last week’s data updates, while getting a mostly positive data point on corporate vibes, and a flattening in political vibes. Second, the rotation of funds flows from US equities to bonds and European equities strengthened last week.

The big things you need to know: First, there was very little change last week in the stats we monitor to track reporting season, aside from the continued drift lower in the bottom-up consensus 2025 S&P 500 EPS forecast to a little below $271. Second, uncertainty, policy, tariffs, and FX remained in focus in last week’s earnings calls. Third, we continued to find evidence of weakening vibes in the latest updates from the AAII investor survey, the NFIB Small Business sentiment survey update, and EPFR funds flows.

The big things you need to know: The big things you need to know: First, the earnings backdrop has softened a bit on the stats for the broader US equity market, and has also justified the rotation in performance leadership that has been seen. Second, company commentary in last week’s earnings calls highlighted the uncertain optimism that is driving US equity market performance at the moment. Third, weakness in investor sentiment and a miss on consumer sentiment stand out in our high frequency updates last week. We continue to closely monitor the vibes whose anticipated strength has been an...

The big things you need to know: The big things you need to know: First, 4Q24 earnings season looks solid on the stats so far. Second, bulls bounced back in the weekly AAII survey last week, as US equity flows stabilized.

The big things you need to know: First, the initial batch of 4Q24 earnings call commentary, which is mostly from Financials, highlights the optimism and uncertainty that are both embedded in the current outlook for stocks. Second, investor sentiment on the AAII survey continued to slip last week despite stabilization in the S&P 500 itself. Third, we continue to see some signs of mild rotation affecting US equity funds flows where we continue to see a loss of momentum. At the same time, we are seeing improvement in flows to bond funds, global equity funds, and several categories of...

The big things you need to know: First, we review our thoughts on last Friday's jobs report and reaction in the S&P 500 and Russell 2000. Second, with 4Q24 reporting season getting underway, we review what we’re listening for in S&P 500 company earnings calls. Third, we run through updates on other high frequency indicators, including a new chart comparing market cap and net income concentration for the biggest names in the S&P 500.

The big things you need to know: Today in the podcast, an update on our S&P 500 sector outlook for 2025, and the results of the quarterly RBC analyst survey that we just updated in late December. Three big things you need to know: First, globally – taking into account the views of our analysts in all of our coverage regions -- our analysts tilt constructive on performance, valuations and demand, but have more mixed/neutral views on the US and non-US political backdrops. Second, our work on global equity funds flows highlights how US, growth-oriented sector, and most cyclical sector fl...

The big things you need to know: First, modest downward revisions have returned to bottom-up consensus S&P 500 EPS forecasts. Second, frothy US equity market sentiment has been a problem for the US equity market, but our work suggests that many investors have become cognizant of this problem and that it is starting to self-correct. Third, outside of the biggest market cap names in the S&P 500, a number of our valuation indicators have started to contract. Fourth, US equity funds flows deteriorated as 2024 came to an end.

The format of this special edition of RBC’s Markets in Motion is a little bit different from what we usually do, and runs a little bit longer than usual. In this episode, Lori Calvasina, Head of US Equity Strategy, is joined by two of her macro partners at RBC Capital Markets, Head of US Rates Strategy, Blake Gwinn, and Equity Derivative Strategist Amy Wu Silverman. With 2024 winding down, all of their outlook reports out, and too many December investor meetings behind them to even count, these three thought leaders at RBC Capital Markets came together to discuss their th...

The big things you need to know: Three big things you need to know: First, positioning in US equity futures per the weekly CFTC data has taken a tiny hit. Second, consensus US GDP forecasts have moved up, along with consensus Fed Funds and 10-year yield forecasts. Third, other things that jump out on our high frequency indicators include the continued decline in bottom-up consensus 2025 S&P 500 operating margin forecasts, geographical equity fund flow dynamics, and recent sharp inflows into momentum equity funds.

Today in the podcast: Our thoughts on the outlook for the S&P 500 sectors in 2025, with a focus on those where we've made changes to our view.

The big things you need to know: First, we have upgraded Communication Services from market weight to overweight. Second, we are downgrading Health Care to market weight from overweight. Third, we are downgrading Materials from overweight to market weight.

Today in the podcast: Highlights from our 2025 US Equity Market outlook, in which we reviewed the top 10 things we’re thinking about as the new year comes into view. We won’t go through all ten, but are going to run through some of the more important highlights regarding our broader market call.

The big things you need to know: First, our YE 2025 S&P 500 price target is 6,600 – that’s our base case; we also run through our bear case of 5,775. Second, sentiment is modestly constructive on a 12 month view but also makes the case for a near-ter...

Three big things you need to know: First, over the past week we’ve become increasingly convinced that a 5-10% pullback in the S&P 500 may have already started. Second, post-election company commentary has been heavily weighted to tariffs, a part of the Trump agenda that has concerned many equity investors. Third, other things that jump out from our high frequency indicators include Financials valuations that remain slightly attractive vs. the broader market.

Three big things you need to know: First, earnings season is winding down with a disappointing feel to us on the stats, though it’s admittedly not driving price action right now. Second, in our transcript reading, a mixed macro and consumer remained in focus, as companies began to highlight key policy issues they are watching post election. Third, positioning in US equity futures, for both the S&P 500 and Russell 2000, looks stretched. Valuations have some room to run, but not a ton.

Today in the podcast, we run through three things in focus in our conversations following the US election.  First, we review the tailwinds for US equities that we’ve been highlighting from a Trump win, along with some of the headwinds to watch out for. Second, we highlight why we think Small Caps have at least a little bit more room to run and what we’re watching to help us know when it’s time to fade the trade. Third, we review our thoughts on the old economy, value-oriented sectors that did well on Wednesday.

We’ve recorded this on the day of the US Presidential Election, and that’s what we're focusing on today.

There are 7 big things you need to know: They focus on the set-up, the historical playbook, bottom-up policy implications per our analyst survey, our thoughts on positioning trades, one tailwind that will manifest regardless of what happens, tail risks, and our rundown of what we’ll be watching on election night and possibly the days beyond.

Three big things you need to know: First, the early S&P 500 stats are now pointing to a mildly disappointing 3Q24 reporting season so far. Second, a mixed backdrop, the need to wait a bit longer for interest rate relief, and the need to get through the election were key themes in last week’s earnings calls. Third, the US election has been in focus in our recent meetings with US-based long-only investors, who we encourage to be ready for all outcomes.

Three big things you need to know today: First, the early earnings stats are mixed for the broader market but promising for the rotation trade. Second, company commentary continues to suggest the plumbing of the economy is in good shape, with a few clogs. Third, our examination of index, sector and industry performance and trends in polling and betting market averages suggest to us that several traditional Trump trades (specifically, Small Caps, Energy, Financials) have remained intact.

The big things you need to know: First, we’ve done some housekeeping on our S&P 500 EPS estimates for 2024 and 2025, resulting in very modest changes. Second, we highlight the two things we’re paying the most attention to in reporting season – specifically, qualitative color from companies on hot macro topics and whether mega cap Growth can maintain its earnings dominance. Third, we highlight what else jumps out from our high frequency indicators on sentiment and the US election.

Two big things you need to know: First, globally our analysts are generally constructive on performance, valuations and interest rates, with Materials most in favor and Consumer Staples most out of favor across all of the questions we asked. Second, within the US we are reiterating our overweights on Financials and Materials, upgrading Health Care to overweight, and downgrading Utilities to market weight. Energy remains a tactical overweight but goes on downgrade watch.

The big thing you need to know: Small Caps got a boost from the better-than-expected jobs report on Friday, reinforcing our belief that a return of economic tailwinds is the catalyst they need to take valuation and positioning to the next level.

Three big things you need to know: First, our survey results, which are bottom-up in nature and driven by domestic policy views, imply that the event is relevant to US equity markets, but perhaps less so than some market participants may believe. For our US analysts, a Republican sweep was seen as the most bullish outcome, while a Democratic sweep was seen as the most bearish outcome, but the key thing to note is that the tilts were extremely mild. Second, some of the traditional Trump trades continue to emerge in policy assessments and sector views. Among our US...

Two big things you need to know: First, valuations continue to look full for 2024 on the S&P 500, but our model argues for upside in 2025. Second, there’s a lot of little stuff to talk about right now. We run a few of the key updates on our high frequency indicators including those on the rotation trade, small caps, and the election.

Two big things you need to know: First, a few things (besides renewed optimism over a 50 bps cut) went right for Small Caps last week. Second, we highlight our current, top-down US equity market read throughs from the domestic policy platforms of the Harris and Trump campaigns. The longer-term signal their platforms are sending is more interesting to us than the noise around any shorter-term policy related sector trades.

Welcome to RBC’s Markets in Motion podcast, recorded September 9th, 2024. I’m Lori Calvasina, Head of US Equity Strategy at RBC Capital Markets. Please listen to the end of this podcast for important disclaimers.

Three big things you need to know:

First, Friday’s jobs report added to investors’ uncertainty regarding the labor market, but the data point that concerned us from last week was the spike in Tech layoffs in the Challenger report.

Second, election uncertainty has persisted with policy getting greater attention from both sides. We run through our US equity m...

Two big things you need to know: First, as we return from the Labor Day holiday weekend in the US, we find that major challenges for US equities are still lurking. We remain confident in our 5,700 YE 2024 S&P 500 price target, but acknowledge the challenges that must be worked through. Second, other updates from our high frequency indicators keep us in the camp that believes the US economy is slowing but isn’t on the cusp of an outright downturn. Overall, we continue to take comfort in earnings and economic data.

The big things you need to know: First, 2Q24 earnings season is ending up solid. With most reports in, we highlight a few of the most interesting charts in our deck on earnings right now. Second, other updates on our high frequency indicators were generally positive for US equities and mixed for the rotation trade. We end the summer of 2024 with increased conviction that August 5th was the low in the recent pullback, even if some choppiness seems likely to be there to greet us when we return in September, and feeling good about our 5,700 YE 2024 S&P 500 price...

Three big things you need to know: First, last week’s price action relieved some pressures on the stock market, but didn’t solve its major problems. Second, earnings remain solid with no major deterioration in corporate tone. Third, we’d be more selective with value-oriented defensive sectors going forward.

Three big things you need to know: First, earnings season has been fine so far, and what we’ve read has kept us in the “tired goldilocks” camp. Second, we run through the latest updates for the indicators we’re monitoring in the rotation trade. We are mindful of headfakes, but think the trade may still have some room to run in the short term. We also still think whether a durable multi-year leadership transition is underway remains to be seen. Third, individual investor sentiment took a big hit last week per the AAII survey, while US equity flows have rem...

Four big things you need to know: First, investor sentiment has gotten as extreme as it did last August and this past March. Second, earnings season is off to a solid start, but we are still looking for some additional evidence in support of the idea that we’re seeing a durable leadership shift rather than a short-term rotation trade. Third, we’ve been monitoring our other high frequency indicators for clues on the rotation trade. Some suggest the rotation trade has room to run but others are less clear. Fourth, we highlight what we’re watching in the equity...