Markets Don't Have to Make New Lows on Earnings: RBC's Calvasina

The transcript discusses the bear market, focusing on earnings estimates and market trends. It highlights the need for adjustments in forecasts and the potential for market volatility. Investment strategies are explored, emphasizing the importance of recovery trades and sector performance. The role of small caps, currency impact, and valuation are analyzed, along with the potential for mergers and acquisitions. The discussion concludes with insights into leadership in market recovery and the importance of early preparation.

What is the main issue that the buy side is concerned with in the current market?

• High interest rates

• Certainty around multiples

• Government regulations

• Inflation rates

What is the historical trend for earnings estimate revisions in relation to stock prices?

• Revisions have no impact on stock prices

• Revisions occur before stock prices bottom

• Revisions occur simultaneously with stock price changes

• Revisions occur after stock prices rise

Which sectors have people been investing in defensively throughout the year?

• Technology and financials

• Energy and utilities

• Real estate and materials

• Staples and healthcare

What is the expected reaction of small caps to the introduction of a risk-free rate?

• They will benefit from higher quality investments

• They will experience a decline in liquidity

• They will underperform

• They will face increased competition

Which type of small caps are considered appealing in the current market?

• Higher quality, more liquid names

• Only mid caps

• Lower quality, less liquid names

• All small caps equally

What is a potential outcome of the current economic environment on mergers and acquisitions?

• Decrease in M&A activity

• Increase in industrial roll-ups

• Stability in market valuations

• Reduction in international investments

Why is it important to discuss new leadership in the recovery phase now?

• Because the market is stable

• To avoid investing in growth stocks

• To prepare for rapid market changes

• Because industrials are undervalued