A Better Overall Tone, But Key Challenges Remain

By Lori Calvasina
Published July 26, 2021 | 7 min listen

This week in the podcast we take a look at what we learned in the second full week of 2Q21 reporting season. Three big things you need to know: First, the overall tone from management teams improved in week 2 relative to week 1, with a focus on the strong demand and cash deployment backdrop, increased confidence on the 2nd half, and COVID concerns toned down. Second, while we generally sensed a better tone regarding the ability of companies to manage through margin pressures, we also came away with the impression that management teams are inclined to see general inflationary and supply chain pressures as enduring for a bit longer. Third, while upward earnings revisions are still happening, we continue to see a softening in earnings sentiment driven by deterioration in Financials, Consumer Staples, Health Care, and Utilities specifically and Value, Defensives, and Cyclicals more broadly.


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Lori Calvasina

Lori Calvasina
Managing Director & Head of U.S. Equity Strategy, RBC Capital Markets


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