RiskReversal Pod Why Top Strategist Lori Calvasina Remains Constructive on Stocks
May 19, 2025
Lori Calvasina, Managing Director and Head of US Equity Strategy at RBC, shares her insights into the current financial landscape. She discusses the balance of bullish and bearish market sentiments and the complexities of navigating economic uncertainty. The conversation highlights the role of geopolitics and tariffs in market performance, alongside the influence of AI on corporate strategies. Lori emphasizes the necessity of a data-driven approach and adaptability in forecasting, as well as the implications of rising yields and passive investing on equity valuations.
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Valuation and Positioning Stretched
- Valuation and positioning were stretched early in the year, signaling low tolerance for bad news in the market.
- These stretched levels matched previous peaks before downturns, hinting at vulnerability to negative events.
Changed Retail Investor Behavior
- Retail investors have been trained not to sell at the wrong time, often aided by financial advisors.
- This changes traditional fund flow signals, making retail behavior less contrarian and more buy-the-dip oriented.
Impact of International Passive Inflows
- International passive fund inflows have been significant drivers of U.S. markets.
- Recent questions about foreign appetite for U.S. assets may impact passive investment flows and market stability.