The easy money has been made from the rally, PNC's Amanda Agati says

PNC Financial's Amanda Agati is positioning for a challenging fall.

Agati, the firm's chief investment strategist, questions whether the market can move meaningfully higher with uncertainty relating to the presidential election, the coronavirus' path and effectiveness of vaccine trials churning in the background.

"I don't know if I want to say — or go as far to say — that the easy money has been made. But it sure feels like that from where valuations are sitting in the neighborhood of 23 times forward P/E [price to earnings] on the S&P 500," she said on CNBC's "Trading Nation" on Wednesday.

The S&P 500 closed at an all-time high on Wednesday, marking its 22nd record close of the year. It's now up more than 55% since the March 23 low.

"Many of the technical indicators relative to strength and others are looking pretty stretched here just given the laundry list of challenges still facing the markets and the economy," said Agati. "We're heading into a fairly volatile backdrop over the balance of this fall."

According to Agati, a Joe Biden win could create additional tension on Wall Street due to his tax policy.

"That could be a pretty significant headwind at a time when we really don't need it hitting," she said. "We could see an 11% to 12% earnings growth hit if his tax package ... went into effect in early 2021."

She also speculates a President Donald Trump reelection win could spark anxiety for the global markets.

"There is really only one group in our view that's likely to be pretty significantly challenged in a Trump second term, and that's emerging market equities," Agati said. "We are a big fan of the fundamental story behind emerging market equities, but we think that Trump will very likely take a much harder line stance on trade policy, and in particular, policy related to China."

However, Agati contends the biggest wild card going forward is still the pandemic — not the presidential race, which has been tightening.

"When you are running multi-asset class portfolios, so equities, fixed income and alternatives, it can be very, very difficult to make grand or sweeping changes ahead of a binary event such as an election," she said. "So, we aren't making meaningful changes just purely based on what that potential outcome could look like."

For now, Agati is sticking with what has been working for much of the rebound: megacap growth, particularly technology. She's still cautious on small and mid-cap stocks based on the notion the economic rebound will be far from smooth.

"Pretty significant macro headwinds [are] still swirling around," Agati said. "This is a square root-shaped recovery. We had a sharp downdraft, a sharp rally and now we're just going to chop around for a while."

The Biden campaign did not provide a statement on Agati's tax remarks.

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