Jobs numbers last week suggested labor market softness, which hit a "vicious" leadership rotation in the stock market, Lori Calvasina, head of U.S. equity strategy at RBC Capital Markets, suggested Monday.
Calvasina, appearing on CNBC's "Squawk Box," addressed last week's market volatility, marked by the Dow Jones Industrial Average hitting a record 50,000 while the Nasdaq index closed lower.
"I think we're going through kind of a vicious leadership rotation in the market and I think the other thing frankly that hurt the market a little bit last week was that you had those jobs numbers towards the end of the week," she said.
While the reports weren't particularly important, she explained, "There was some signal in there suggesting maybe labor's a little bit weaker than people thought. And that hurts the rotation trade" into value and cyclical stocks.
Coming into the year, investors were jittery about artificial intelligence and tech, and the jobs numbers attacked areas that people were trying to rotate into, she said. Small-cap stocks have been the "poster child" for the rotation trade, but investors need to see accelerating jobs growth, and it hasn't been happening, said Calvasina.
The market needs more color on what's happening, she added. Jobs and consumer inflation reports are coming this week.
Calvasina also noted that "earnings haven't been that fantastic." The S&P 500 has been priced for perfection, "so just meeting [expectations] is not good enough," she said.
RBC maintains a 7,750 year-end and 12-month target for the S&P 500.
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