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
Close to a Crossroads
The big things you need to know:
⢠First, our tiers of fear, sentiment, and valuation analysis suggest that the stock market could stabilize soon, even if Thursdayâs close doesnât turn out to be the low. But thinking about the next few months and into early next year, itâs important to remember that fundamentals still matter as our valuation and sentiment work are not âwashed out.â
⢠Second, we likely need to see earnings sentiment stabilize to power P/Es higher.
⢠Third, other things that jump out in our indicators include the strong end to th...
Going with the Global Flows
This week, we have a special edition in which we highlight some new analysis that we've
collaborated on with some of our colleagues. Youâll be hearing from Simon Simoski from my
team, along with Sara Mahaffy (RBC Canadian Equity and Sustainability Strategist) and Chris
Louney (RBC Commodity Strategist). Theyâll be discussing their big findings for global asset
classes, within US and non-US equities, for major sectors and themes in global developed
markets, and within Canada, sustainability, and commodities. The big thing you need to know
soft...
Still on the Sidelines With Tech, More Midterm Thoughts, Getting More Constructive on Small Caps
The big things you need to know:
First, we are staying on the sidelines with Tech following our mid October downgrade, while also reiterating our overweight on Health Care.Second, we add to our thoughts on the midterms, highlighting how recent developments impact our view of the set up, and what weâve learned from our ongoing review of the big issues in close races that could be relevant to sector calls going forward.Third, we highlight the recent inflection in Small Cap performance relative to Large Cap and walk through why weâre turning constructive on Small Caps...Midterm Musings
The big things you need to know:
First, we review our thoughts on the US midterm elections, where we think it makes sense to be prepared for all outcomes. We run through our thoughts on the implications of each outcome for the US equity market based on the historical playbook and our analyst survey work, and also review our analysis of what stock market relevant issues have been in focus in battleground Congressional campaigns.Second, other things that jump out include the still lackluster stats for 3Q26 reporting season, the relationship between P/Es and earnings revisions trends...Caveats and Risks
The big things you need to know:
First, 3Q26 reporting season is off to a slightly soft start on the stats, with company commentary generally still highlighting resilience in the economy and consumers and tailwinds from AI, with some caveats, while giving investors plenty to think about in terms of risks that may lie ahead.Second, recurring topics in conversations last week with US investors included midterms, earnings, and positioning. Overall, investors came across as neutral with a dose of nervousness and a bit more short-term focused than usual.Third, other things that jump out in our other...Risks In Both Directions Heading Into 3Q26 Reporting Season
The big things you need to know:
First, we enter 3Q26 reporting season seeing risks in both directions.Second, the investors we met with in Canada last week were best described as cautiously optimistic, with earnings, midterms, and confusion over recent resiliency in the equity market all top of mind.Third, other things that jump out this week include the recent surge in US performance relative to non-US which may be on borrowed time, the bounce back in investor sentiment, and a few important shifts in sector valuations ahead of reporting season.3Q26 Global Analyst Survey Results - The Micro Reality
The big things you need to know:
First, our analysts are moderately constructive across the globe, though we did detect a bit more optimism outside of the US.Second, Energy, Health Care, and Technology stand out at the global sector level for capturing some of the most optimistic views on all of our main questions.Third, within the US, muted midterm views remain in place at the broader stock market level, but our analysts did highlight a few potential sector trades in different scenarios.Fourth, in terms of key risks, our US analysts expressed more concern about the...Silver Lining For Small Cap
The big things you need to know:
First, Fridayâs weaker than expected jobs report, which was still viewed as healthy by our economists, left us feeling incrementally better about Small Cap.Second, other things that jump out in our updates this week include the stall in stock market optimism among consumers in the latest Conference Board survey, recent deterioration in our earnings yield gap model, low layoff levels in the Challenger report, the stall in Democratic sweep expectations in midterm betting markets, and the expensive valuations we continue to see in Financials, Industrials, and Utilities.Digging Into Past Drawdowns
The big things you need to know:
First, we reviewed the drawdowns in the S&P 500 of 11% or more dating back to 1956, an exercise that helps to clarify why US equities have been resilient recently (in particular, strong earnings and capex dynamics).Second, other things that jump out in our updates include the link between crude oil and 10-year yields, the renewed leadership of the US and mega cap growth trades, the lack of movement in consensus EPS forecasts for most sectors (ex Energy, Mag 7, and Tech) in September, the slight softening of C suite confidence we saw...Lessons From Past Lift Offs
The big things you need to know:
First, our review of S&P 500 performance during the Fed hiking cycles that have occurred since the mid 1990s reminded us that the stock market tends to stumble at lift off, with a median initial drop of 9.6% (ex 2022, which was an extreme outlier). This keeps us vigilant for a near-term tier 1/garden variety pullback of 5-10% in the S&P 500.Second, other things that jumped out in our updates this week included the sharp drop in AAII net bulls to levels that have generally marked the low since early 2025 when the...The Fall Feels
The big things you need to know:
⢠First, with the US summer ending and fall getting underway, we refresh our thoughts on the US equity market outlook in terms of both the near term (where we think risks of a tier 1 / garden-variety pullback have grown) and the longer term (where we remain constructive and reiterate our 12-month S&P 500 price target of 8,150, noting that upside risk exists if interest rate fears recede).
⢠Second, after taking a break from our Pulse report over the past few weeks, we run through some of the key things that jump...
Midterms On Our Mind
The big things you need to know:
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 weâre 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
The big things you need to know:
First, takeaways from last weekâs 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 weekâs 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
The big things you need to know:
First, valuation opportunity is opening up in the US equity market from a variety of perspectives.Second, in the aftermath of Wednesdayâs 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
The big things you need to know:
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 weekâs earnings commentary from S&P 500 companies reiterated the themes of resiliency and AI tailwinds, but didnât give us much insight on how to think about recent war developments.Third, we review how weâre thinking about the role of the retail investor in todayâs US equity market, which differs in some respects from the past, and how weâre monitoring risks on this fr...Mixed EPS Stats, Cautiously Optimistic Commentary
The big things you need to know:
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
The big things you need to know:
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 weâre on guard for a shift back into US and mega cap Growth leadership.June Survey Results Reveal Optimism, Not Euphoria, Heading Into 2H26
The big things you need to know:
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
The big things you need to know:
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
Two big things you need to know:
First, forward P/Es have generally been de-frothed, but havenât 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.The Time is Now â We Need Your Help
Itâs been a year, and itâs only June. We built a framework to help investors navigate the fear and stuck with our constructive longer-term view.
If youâve found our research, and this podcast, helpful, weâd appreciate your vote in the Extel (formerly II) All America Research survey.
Voting is open and closes this Friday, June 12th â please cast your vote now.
Here is a one-minute video explaining why we think weâve earned it this year.
To vote go to:
https://www.extelinsights.com/support/voting-helpAll-America ResearchMacr...From Rotation to Derisking
The big things you need to know:
First, lingering concerns about interest rates and the Fed flared up on Friday after a surprisingly strong NFP report. We run through our thoughts on why this hit the Nasdaq so hard and note that risk of a tier 1 / garden variety pullback (5-10% from peak) has risen in the near term.Second, other things that jump out include the recent drop in bitcoin, which supports the idea that risks of a tier 1 pullback have risen, and the sharp drop in Small Caps on Friday on interest rate fears.Investment strategy through the âup crashâ and beyond
RBCâs 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 is a special edition of the podcast recorded live from the RBC Global Energy Power and Infrastructure Conference in New York on June 3rd, 2026. Lori teamed up with Callie Simpkins (Managing Director on RBCCMâs Cross Asset Hedge Fund sales team who moderated the discussion) and Amy Wu Silverman (Managing Director and Head of Derivatives Strategy) to discuss the outlook for the US equity market and other key macr...
Earnings Sentiment Broadens Out
The big things you need to know:
First, earnings sentiment (the rate of upward EPS estimate revisions) is now improving broadly within the equity market, which we think opens the door for a short-term pause in mega cap Growth leadership within the US and US leadership within global developed markets equities.Second, the Growth/Value trade within Large Cap has turned choppy again, which we think may reflect the broadening out of improving earnings sentiment and valuations that have started to look frothy for mega cap Growth on some metrics.Third, stock market optimism improved in the latest...Everything in Moderation
The big things you need to know:
First, we think the recent pick up in 10-year yields raises the risk of a tier 1 (5-10%) pullback in the S&P 500 in the short-term, but does not alter our longer-term constructive view on the S&P 500.Second, it was business as usual at the RBC Health Care conference last week in terms of company commentary.Third, other things that jump out from our latest updates include a move up in the median NTM P/E for the biggest market cap names in the S&P 500 (which also adds to risk...London Fog
The big things you need to know:
First, the investors we met with this past week, in our trip to London and Switzerland, were keen to explore other opportunities in US equities beyond Semis/Tech/AI, but had difficulty envisioning what those were.Second, we highlight continued outperformance of high price momentum in our factor work and what weâre seeing in our valuation work for this part of the market, a pick up in the rate of upward EPS estimate revisions for the S&P 500 as reporting season slows down, and the signal weâre currently getting from...Positivity Isnât Always Naivete
In this special cross over edition (originally recorded for the RBC Capital Markets Macro Minutes podcast), Lori joins Blake Gwinn, Head of RBC Capital Markets US Rates Strategy in a conversation on US equities, US rates, and the Fed.
What we discuss:
Equity markets keep hitting all-time highs. Rates markets are telling a more cautious story. So which one has it right? In this episode, we examine the complacency narrative through both an equity and rates lens, unpacking whether risk assets are fully pricing the range of Iran conflict outcomes or looking past risks that...
Baking in a Two-Speed Economy & EPS Backdrop into Our S&P 500 Forecast
The big things you need to know:
First, we have lifted our 12-month-forward S&P 500 price target to 7,900, which represents a 7.7% gain from the May 7th close. In adjusting our forecast, we are focusing on our valuation/EPS model, which does the best job of baking in a two-speed economy and earnings backdrop.Second, on bigger-picture positioning, we continue to prefer Growth over Value, US over non-US, and like Small Caps (but not as much as Large Cap Growth).Our sector views are mostly unchanged, but we have lowered Health Care to market weight from overweight. Third, we...Taking The Stock Marketâs Temperature, Takeaways from an Avalanche of Earnings
The big things you need to know:
First, US equity market valuations are on the rise, but donât look topped out yet. We remain constructive on the US equity market in the year ahead, recognizing that the path may not be linear.Second, last weekâs earnings reports continued to point to resilient outlooks with a dose of caution fueled by a strong start to the year, highlighted challenges to consumer resiliency in restaurants and travel but otherwise a reiteration of the cautious but stable theme, and alluded to a complex web of buffers in place for comp...Resilience With a Dose of Caution
The big things you need to know:
First, the three things that stuck out to us in our review of earnings calls last week included outlooks that emphasized resiliency but contained a dose of caution, the conversation on Iran war impacts (present and future) getting underway, and descriptions of cautious but stable consumers.Second, with US equities breaking out to a new 2026 high relative to non-US equities, we note that valuations suggest thereâs room for this trade to run and that weak earnings revisions breadth is not a problem unique to the US.Third, funds flows are sh...April 2026 Global Analyst Survey Results - Constructive, Aside From The War
The big things you need to know:
First, our analysts were generally constructive aside from the war.Second, our survey results reiterate the idea that the US is seen as a safety trade due to greater war resiliency, and that Europe does not necessarily present as a better alternative despite the potential for the US to lag if/when war fog clears.Third, we review the most interesting sector tidbits from the survey.Climbing the Wall of Worry
The big things you need to know:
First, despite the strong rebound in the US equity market, investor sentiment remained subdued last week. This signals to us that there is room for US equities to run and climb a wall of worry.Second, 1Q26 reporting season got off to a strong start last week, evidenced by a sharp pickup in the percent of companies beating consensus EPS forecasts and reassuring commentary from companies.Third, other things that jump out in our latest updates include strong outperformance by Large Cap Growth and growth-oriented sectors in April, the low-quality burst...A Fragile, Foggy Bottom
The big things you need to know:
First, our 12-month S&P 500 price target remains 7,750, and we assume the index has put in a fragile, foggy bottom.Second, we run through our thoughts on what weâre hoping to learn more about in the upcoming reporting season.Third, other things that jump out include how 2026 EPS growth forecasts for most sectors have been frozen since the start of the war, and the decline in consumer expectations for stock market performance over the next 12 months.Thinking Through Tier 2
The big things you need to know:
First, the tactical indicators weâve been tracking to gauge when equity investorsâ fears may have gone too far continue to show signs of significant deterioration but are not yet pointing to extreme fear suggesting more downside in stocks remains possible in the near term.Second, other things that jump out include new stress tests on our valuation/EPS model, the latest C-suite tone, the signals from our US GDP model for the S&P 500 if consensus forecasts start to erode, and evidence of derisking in equities in the latest funds flow...This Might Take A Minute
The big things you need to know:
First, we review our key takeaways from our review of March company commentary on the Middle East conflict on EPS calls and in conference presentations. What we read adds to our understanding of why the US equity market has been fairly resilient since the Iran strikes, and also leads us to believe that it may simply take more time for the equity community to fully understand the impacts from an extended conflict.Second, other things that jump out this week include much better EPS estimate revisions trends in the top-10 market...Lingering Confidence & Emerging Concerns
The big things you need to know:
First, in tandem with the 5% decline in the S&P 500, investor and consumer sentiment have slipped in recent updates as investors have digested the possibility of a longer conflict in Iran and consumers have started to notice higher gas prices.Second, we review our macro takeaways from RBCâs Financial Institutions conference, where we detected echoes of the lingering confidence and emerging concerns that are seen in the surveys we discuss.Beyond the Headlines: Oil, Inflation and Market Risk
This week, we are excited to bring you a special edition of the podcast, a recording of a panel done by Lori Calvasina (Head of US Equity Strategy), Helima Croft (Head of Global Commodity & MENA Research), and Frances Donald (Chief Economist, Royal Bank of Canada) on March 10th, 2026, at the RBC Financials conference in NYC.
The team discussed recent events in the Middle East and the implications for the US economy and stock market, and was moderated by Brian Sullivan of CNBC.
A Bottom-Up Look At The Bear Case On Iran, US Valuations From Two Perspectives
The big things you need to know:
First, we review the results of a survey we conducted of RBCâs equity analysts on the conflict in Iran, which helps explain the resilience weâve seen in the S&P 500.Second, the valuation and sentiment barometers weâre tracking point to room for further downside in the S&P 500 in the near-term in absolute terms, while our work on US valuations vs. other global developed markets highlights why the US equity market has been embraced as a safe haven, helping outperformance versus global peers to re-ignite.What Weâre Watching on Iran & Stocks Generally
The big things you need to know:
We run through five things weâre thinking about regarding recent developments in the Middle East from a stock market perspective.Then, we wrap up with a few things weâre watching in terms of general stats to help us know when the recent risk off mood in markets may have played out.What Weâre Thinking About As Tariffs Move To A New Phase
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.Third, we run through our...