Krakauer: "Think Globally" for Equities Amid Strait of Hormuz Volatility

• Market's focus remains on strong fundamentals and rising Q1 earnings growth expectations (18% for S&P 500).
• Consumer sentiment is at a 'downside inflection point,' but historical data suggests potential for double-digit S&P 500 returns in the following 12 months.
• Elevated energy prices complicate the Fed's path, with upcoming retail sales data and Fed hearings crucial for understanding future policy.
• Global diversification is recommended, with tailwinds seen in European and Japanese markets.
• Private credit is shifting from an opportunity to a risk management story, requiring careful due diligence rather than indicating systemic problems.

Despite recent geopolitical shocks and energy volatility, the market remains primarily focused on strong fundamentals and rising earnings expectations. Investors are advised to consider global diversification and monitor key economic data like retail sales, as consumer resilience and the Fed's path amidst inflation are critical factors. The overall outlook for equities remains bullish.