Since hitting records half a year ago, Wall Street has contended with trade conflicts, European instability and sell-offs in the largest tech companies in the world.
Now it's time to get back to basics, says one of Wall Street's biggest bulls.
"There's only one thing that really drives the market," Tony Dwyer, chief market strategist at Canaccord Genuity, told CNBC's "Trading Nation" on Tuesday. "You only have to figure out which direction that earnings are going."
Earnings should continue to leap this year, according to Dwyer's calculations. He revised fiscal 2018 operating earnings forecasts to $160 a share from $155 a share in a note released Tuesday.
"I'm really having a hard time thinking that that's going to be too high," said Dwyer.
The fear that the first quarter marked peak profit growth has been a worry for investors since the earnings season wrapped in May. Dwyer says robust economic data should keep the fuel burning on profit growth through this year and next.
"I intentionally waited until early June to increase the number because I wanted to make sure that the early-year economic euphoria didn't fade," he said. "The NFIB, which is the small business optimism index, is near a historic high, consumer sentiment is near a historic high. That doesn't happen when you're right about to tank the economy."
Other analysts share in Dwyer's bullish price forecasts. After a 25 percent increase in first-quarter S&P 500 profits, analysts surveyed by FactSet expect full-year growth of 20.7 percent. Profit expansion of that size puts the average S&P 500 earnings estimate at $160.11 a share.
Should earnings determine direction through year-end, any shorter-term weakness presented by exogenous events like trade talks presents a buying opportunity, says Dwyer.
"When you have an imminent sign of a recession, that is the only time you want to sell weakness in the market," said Dwyer. "The fundamental backdrop, until well after you invert the yield curve, creates an environment ripe with opportunity."
The yield curve, which measures the difference between shorter- and longer-maturing bonds, is often used as a leading indicator of an economic downturn. The yield curve has flattened but not yet reached the point of inversion.
Dwyer expects profit growth to have a big impact on stock growth this year. He upped his full-year S&P 500 price target to 3,200 from 3,100 based on a multiple assumption of 20 times forward earnings. That target is the highest on the Street. The second-highest is UBS at 3,150.