Stocks have had a crazy week, with markets fluctuating on hot inflation prints and rate cut outlook adjustments. Prime Capital Investment Advisors Director of Investments Will McGough, and Ziegler Capital Management’s Chief Investment Officer and Senior Portfolio Manager Dan Skubiz joins Yahoo Finance Live to discuss their market outlooks as earnings season starts.
McGough explains that markets are currently focused on earnings growth rather than multiple expansion. He notes that valuation multiples are in the low 20s, leaving limited room for further expansion. McGough emphasizes that earnings growth "needs to come through" this earnings season to drive market growth.
Skubiz attributes the market’s weakness to uncertainty surrounding the Federal Reserve’s monetary policy path and potential rate cuts. He observes "choppy trading" since the hot March CPI print, which cast further doubts on the rate cut outlook, leaving the market "aimless right now."
Both experts believe small-cap stocks have potential upside. Skubiz acknowledges that large-caps have been outperforming small-caps, but he still sees "a space for small-caps". McGough agrees, noting that small-caps "look attractive from a valuation standpoint."
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