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It's great to have you here. So just taking a look at your Twitter account to no surprise. You're taking a look at why we should be a little bit more optimistic maybe right now. We've got the S&P up just about four and a half percent over the past four days. So what does that tell us maybe about the return of some of this momentum?

Yeah, thanks for having me and what a difference a week makes. I was with Jared a week ago in New York and things didn't feel so good, but here we are. I love what Jared just pointed out. We've had this big rally. So again, that's what I just took a look at this morning before I came on with you. Up over four and a half percent on the S&P 500 to past four days, like Jared just pointed out, that's the best we've been since this year. Best best short-term rally. What's it mean though, right? What's it mean? I looked at previous times you saw a big four-day rally, but above the 200 day moving average implying we're in a bullish trend. Like we still think we're in a bullish trend. You've had these big bare market rallies, but you're usually in a bare market when that happens. So when I took a look at that, what happens next? Three and six months about average returns to be honest, but a year out higher 84% of the time up double digits, um a double digit return. What I'm getting at is everybody's saying this is a bare market rally. It's bearish. No, this is not. This is kind of consistent with a bull market in our view. And we think those lows that were hit early last week are probably it uh for this uh eight and a half percent correction. And now you're back to your regularly scheduled bull market.

Okay. And so rally caps fully on and and if so from your perspective, Ryan, then where and which sectors would be set to benefit the most?

Yeah, I I agree with kind of some of the cool charts that Jared just shared before I came on. I mean, look with some of the yes, tech has been bouncing back, but we are seeing that broadening out. We really like industrials financials last week with all that volatility. Industrials and financials led. We do not see a recession. We see a fed probably going to be cutting. We we can get into CPI. Obviously, inflation is last year's problem in our opinion. We've been saying that for a while. So we like those cyclical areas. We also do like small and mid caps. I know small caps have still been quite frustrating. Mid caps quietly have done very well. That's actually been our largest overweight at the Carson group. So those more cyclical areas are what we like. One more quick thing on technicals, the S&P 500, I mean, it's kind of we'll see where we close, famous last words, I know. But pretty calm right now. We've popped up to the 50-day moving average in the S&P and kind of where a gap was before all that trouble started about a week and a half or so ago. Um so it's logical sense, maybe take a little pause here, perfectly normal structurally that, you know, we're carving out a low, but maybe it is time for a little pause. And we're not too worried about that.

Ryan, talk to me a little bit more about what you just said about small caps. What do you see in terms of what that upside looks like? And then more specifically, I mean, in small caps, people investors can be choosing from a handful of things. So what is it that investors should be looking for when they're trying to identify those investment opportunities?

Uh great point there. You know, when we look at small caps, look at something like regional banks. Regional banks and biotech make up a lot of the small cap world. Regional banks are up 19% last month. That again is consistent with kind of a new bullish trend. Those big moves don't happen at the end of bull markets. They actually start at kind of the beginning of bull markets. So we do like, you know, financials and industrials in the small cap area, kind of like I answered the other question a little bit ago there. Um but what we also like about small caps, historically they start to outperform when the Fed finally cuts. And I know it's been Lucy and the football with Charlie Brown multiple times. Listen, Fed cuts are coming. That's when you tend to see more alpha outperformance. Also small, if you talk about the market, right, what's cheap, what's expensive. Listen, tech communications, they are expensive. That's where their earnings growth coming from. We're more neutral those areas though. If you think about it, those areas, uh small and mid, really small specifically, is the cheapest has been relative to large caps since the late 1990s. That is not a reason blindly to go in. I've heard for my whole career EM is cheap. EM is cheap and it's kind of underperformed for a long time. But when you have these positive drivers within the economy that we thought we was in a recession this time seven days ago. Now we're like, wow, maybe services is actually pretty good. You know, we've got record earnings. It's slowing, yes, but not going into recession. Those are some of the the key tenants why we've liked small and mid all this year.

Ryan, you know, as we think about the S&P 500 firms who are trying to figure out and and I'm bringing this up because it sounds like you're in the soft landing, no recession camp here. Um S&P 500 firms are also less worried about a recession at least according to data um that was run by Apollo Global chief economist Torsten Slock that showed companies are talking less and less about recession on earnings call. If this is not a concern for major companies, how would this then show up in some of the margins and earnings going forward and how investors should be anticipating the back half of this year's earnings growth potential?

Yeah, Torsten, he shares some great charts today. But he gave just how many times companies use the word recession in earnings call. It is very, very low. We saw a huge surge in 22. Now we didn't have an earnings you or didn't have a recession. You could argue parts of the economy. I would agree went into recession in 22, but not the overall economy and not the consumer. But the real surprising thing to us about um kind of what we've been seeing, earnings are records. Yes, but profit margins have continued to expand. I think that's one of the big reasons we're still in a bull market. You have the dual um kind of dual tail wins, if you will, of stronger earnings growth, but also better profit margins. Now, will there be a time where profit margins are are are starting to hit some pressure? Sure, there we we could be getting into a point like that. But overall, Brad, we're not seeing it yet, right? And we can only talk about the data that we are seeing and we're simply not seeing that. One more thing on earnings, kind of back to small caps. You know, next year, S&P 500 earnings are about 14 to 15%. I don't think most people realize this. Small cap earnings are expected to be up maybe more than that, not by a lot, but a little bit more. We know this year's earnings been all about large cap and this and that. But again, if the economy avoids a recession like I've said for a while now, come on with you guys, we think small that that could be be a little low and small cap earnings growth next year, 2025 could be even stronger. And let's not forget the market's a forward-looking mechanism. It'll sniff that out. That's one more reason we think small probably do pretty well. Small and mid will do pretty well the rest of this year.

Ryan, great to catch up with you. Ryan Detrick, Carson Group Chief Market Strategist. Appreciate you joining us just after the opening bell.

Thank you.