00:00Laurie Calvacina of RBC writing, we continue to think earnings are providing a solid foundation for the equity market, but the best part of the earnings story may be behind us.
00:10Laurie joins us now for more. Laurie, good morning.
00:12Good morning.
00:12What's in front of us?
00:14What's in front of us is we've got to still contend with peak valuations.
00:18We've got earnings sentiment that's pretty good, but not nearly back to where it was in August when we were, you know, baking in this much, much better than expected tariff environment.
00:25And I do think, as Lisa mentioned, you know, we do still have some uncertainty on the data.
00:30I know that the data release I'm waiting for is not NFP.
00:32It's not CPI.
00:34I want the CFTC data on U.S. equity futures positioning.
00:37So CFTC, if you're listening, please get that to me very quickly because we've, you know, had this march up to new highs.
00:43There's a lot of thunder kind of rumbling in the distance as we put it in the weekly today.
00:47You know, I know you're going to have Dana on later, but the conference board data, they had an interesting question as well on stock market optimism,
00:55which was not back up to the tip-top highs, but was basically back up to levels that often mark the peak.
01:00So I think we do have to, you know, sort of see, do we have sort of peak optimism around stocks right now and consumers?
01:06The CFTC data won't speak to the consumer side, but it'll give you a lens in terms of how the institutional investor community is looking at it.
01:11You've cautioned this for a while, Laurie.
01:13This is not a one-way ticket to a year-end meltdown.
01:15Yeah.
01:15Is that falling on deaf ears?
01:17You know, it's interesting because if you look at a lot of these stocks that have reported, we're having these big gaps down.
01:22So it feels like we're getting that garden variety pullback in individual names.
01:26It hasn't manifested the surface yet.
01:27I think the worst, you know, kind of day on the drawdown, it's been down a little more than 3%.
01:31We think that should be at least like 5%, probably no worse than 10, frankly, maybe closer to 5% than 10.
01:37But I'll tell you, John, we watched the valuation levels.
01:39And if we look at the S&P 500, just that top 10 market cap cohort, we had gotten up to 30% at one point.
01:45That's basically been the ceiling of the last 10 years that we just can't break through.
01:49And we've fallen back down to about 28 in our latest update, but it's still just not giving you a whole lot of room.
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