Consumers are not what will hold market rally back, says PNC's Yung-Yu Ma

Market Trends & Macro Environment - S&P 500 heading for its third straight winning week in a record rally [1] - Long-term interest rates identified as the primary headwind rather than retail sales or consumer stress [3][4] - Supply and demand dynamics, including record-breaking US Treasury and corporate debt supply, driving long-term interest rates rather than Federal Reserve actions [5] - Elevated oil prices contributing to upward pressure on longer-term interest rates [7] - Potential equity market pullbacks anticipated between now and the end of the third quarter to digest capital expenditure stories [8] Investment Opportunities & Sector Allocation - High-income spending and retirees dipping into savings supporting discretionary areas like restaurants and credit card spending [2][4] - Data center electrification and power identified as key structural themes driven by capital expenditure [7][8] - 10-year Treasury yield surpassing 5% presenting a potential challenge for equity markets and artificial intelligence capital expenditure pace [8] - European banking sector offering strong earnings pictures, positive earnings revisions, and benefiting from bond yield curve re-steepening [10] - European capital goods and industrials positioned well to play the broadening manufacturing cycle beyond artificial intelligence capital expenditures [13]