Investors are feeling shell-shocked after a whirlwind first quarter of 2023, and more surprises may be on the horizon for Q2. We asked the experts for signs of a possible 'April Surprise' and what keeps them looking over their shoulder as the year rolls on.

“The one that I’m still looking at is what happens geopolitically, what happens in Ukraine... and a derivative of that is what continues to happen with US-China relations." -Ann Berry, Threadneedle Strategies Founder

"I think reality is going to set in that the earnings revisions aren’t enough, but the real thing that I think is going to be a problem is if we see a reversal of inflation coming down.” -Lee Munson, Portfolio Wealth Advisors President & CIO

“The surprise going forward in the next few quarters could be that the economy drops off more than anticipated.” -Michael Darda, MKM Partners Chief Economist & Macro Strategist

“It is our belief that focus would shift to fundamentals, shift to earnings, and on that front, we’re already seeing signs of margins compression, earnings contracting for the first time since late 2020." -Wei Li, BlackRock Global Chief Investment Strategist

Video Transcript

- We think about some of the surprises that we could potentially still see in the second quarter of this year and even further out into the rest of the year.

- It's the time of year some look out for an April surprise.

ANN BERRY: The one that I'm still looking at is what happens geopolitically, what happens in Ukraine, and then a derivative of that is what continues to happen with the US-China relations.

MICHAEL DARDA: Thus far, the surprises have really been the resiliency of the labor market. But we do have a backdrop now of a banking crisis that just started weeks ago. The surprise going forward in the next few quarters could be that the economy drops off more than anticipated.

WEI LI: It is our belief that focus would shift to fundamentals, shift to earnings. And on that front, we're already seeing signs of margins compression, earnings contracting for the first time since late 2020.

ANN BERRY: I'm incredibly, incredibly boring. I think cash is queen. But I do think it'll change at some point. So I'm looking out for Q2 earnings. I think they're going to be weaker than expected.

MICHAEL DARDA: At the end of the day, if the earnings are not there, then we could have more problems for the equity market in front of us.

- There's been, certainly, no shortage of surprises in the markets really over the last couple of years, but even just the last several weeks.

LEE MUNSON: Here's what I think that are the biggest risks that I'm concerned about. The Fed's going to keep raising rates a little bit, maybe a couple more times. I think reality is going to set in that the earnings revisions aren't enough. But the real thing that I think is going to be a problem is if we see a reversal of inflation coming down.