It was a bumpy Might for shares.

The S&P 500 eked out a achieve of almost 1% for the month, although sell-offs in excessive tech and progress names made for a unstable stretch.

Nick Colas, co-founder of DataTrek Analysis, says all of it comes right down to earnings.

“The humorous factor about this yr is that we have seen extra earnings revisions than we have seen inventory value efficiency,” Colas informed CNBC’s “ETF Edge” on Monday. “We have seen 12% upside to earnings expectations this yr … It should come right down to Q2 and Q3 earnings.”

Analysts surveyed by FactSet presently anticipate second-quarter S&P 500 earnings to rise by roughly 60% off a depressed pandemic quarter this time final yr. The large banks will kick off the season after they report mid-July.

“The numbers are nonetheless too low, it appears to us, for Q2, so, we must always have one other sturdy earnings season developing, however that might be sort of a tug-of-war till then,” stated Colas.

Put together for extra volatility till that second-quarter earnings season in mid-July offers markets path, he provides.

“Count on a pair extra weeks of precisely what you have simply seen after which, as earnings start to point out themselves via, one other leg larger in the direction of the top of the yr,” he stated.

Any progress in the direction of an infrastructure invoice must also give investor sentiment a lift, in line with Jay Jacobs, senior vp and head of analysis and technique at World X ETFs. His agency’s PAVE infrastructure development ETF launched throughout the 2016 Presidential election cycle, and now he sees much more urge for food for exercise in that space.

“It is very a lot sort of ripe for disruption, if you’ll, with an financial system that is nonetheless beneath prime GDP,” Jacobs stated throughout the identical interview. “Traders are very excited concerning the prospects of in all probability the biggest infrastructure invoice we’ve ever had in the USA and a fund that is actually designed to personal the winners of that kind of invoice – building engineering corporations, commodities, transportation corporations and heavy equipment corporations which are going to be constructing that infrastructure.”

The trail ahead for an infrastructure invoice remains to be unclear. Senate Majority Leader Chuck Schumer said Friday that Democrats would work with or with out Republicans on a plan in June.  The 2 events are cut up on the general price of a proposal.