Matt Bartolini, State Street Global Advisors head of SPDR Americas Research, joins Market Domination to discuss the impact of tariffs on markets and on the consumer discretionary sector. He highlights the banking sector's "turnaround" and insulation from tariff impacts.
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What about those sectors that are impacted by tariffs? But I'm thinking like the banks, for example. I'm curious what what kind of flows positioning you're seeing in that sector?
So, we're starting to see some turnaround in bank positioning. It was a little bit of outflows to start the month, but we've seen inflows over the last few weeks as the sort of ultimate recessionary fears have sort of been put to rest. You know, we do have some sluggish sluggish economic data, but when we look at the earnings fundamentals of banks, looking at maybe 19% earnings per share growth in Q1, valuations are largely constructive, trading at a 75% discount to the market. Normally, it's around 60%, so valuations are constructive. And then again, I just go back to some of the other policies. Now, we look at tariffs. Banks, largely regional banks, generate less than about 10% of their revenue from outside the US. So largely, um, you know, not so much or insulated from tariffs from that perspective. Then also, you have widening net interest margins that could be beneficial to bottom lines as well. So banks is one of those areas where you can sort of hide out in this sort of macro-driven market.
Matt, we covered a lot of a lot of ground in a short amount of time there. Thanks so much for joining us today. Appreciate it.
