Two major market tensions: sentiment vs fundamentals, with sentiment sensitive to headlines but fundamentals strong - S&P 500 earnings estimates increased from 15% to 17% despite war.

Companies still giving positive guidance; even if revised due to higher energy/input costs, year will have strong fundamentals paired with sour sentiment.

Cheap in some pockets; high single-stock volatility creating opportunities with 58% of S&P 500 stocks outperforming index - highest share since 2022.

Low correlations among stocks create environment for stock picking even in poorly performing sectors like financials where 42% outperform.

Shorter-term sentiment challenge around energy, but longer-term secular themes in industrials, materials, utilities with AI infrastructure continuing for years.

Current market bounce could be premature/short-lived if oil prices don't come down, but 2022 showed eventual relief led to strong returns.

Focus on infrastructure layer - moving from capital spenders to recipients in value sectors like industrials, materials, utilities.

Tech shifted from capital-light to capital-heavy; MAG7 valuations dropped from 29x to 23x; international AI supply chain beneficiaries in Korea, Taiwan, Latin America showing strong earnings growth.