Core Viewpoint - The bull market, which began in October 2022, has seen a shift in leadership from tech stocks to sectors like Energy and Materials, indicating a potential new phase in the market driven by cyclical and value companies [1][17]. Sector Performance - Energy and Materials sectors have led the U.S. market with double-digit returns through early February, while Consumer Staples and Industrials are also performing well [1]. - Concerns have arisen regarding late-cycle industries and defensive sectors outperforming as the bull market matures [2]. Upcoming Corporate Events - Several non-tech blue-chip firms are scheduled for investor events that may provide insights into the manufacturing and Main Street economies, following a strong ISM U.S. Manufacturing PMI reading [4][10]. - Notable upcoming events include: - Xcel Energy's Analyst Day on February 5, focusing on power generation and a more aggressive capex plan [5][6]. - Williams Company's Analyst Day on February 10, which will discuss a $5.1 billion power innovation capex initiative [7][8]. - FedEx's Investor Day on February 12, where the company is expected to present an upbeat outlook following a significant share price increase [11][12]. - JPMorgan Chase's Business Update on February 23, which will include an operational overview and a Q&A session [13][14]. Market Sentiment - The bull market is broadening, with capital rotating towards cyclical, value, and real-economy sectors, suggesting a potential strengthening of economic momentum beyond the tech sector [17].

With roughly a third of companies reporting thus far, S&P 500 EPS growth for Q4 2025 currently stands at 11.9%This week, Alphabet, Amazon, and several consumer names take the stage as peak earnings season hits its stridePotential earnings surprises this week: Disney, CME Group, Take-Two Interactive, Phillips 66 and more​Mixed Signals in the Mag 7: AI Spending Rattles Big Tech Headline whiplash returned to US equity markets last week, but this time the drama wasn’t geopolitical. On Thursday, the tech-heavy ...

Market-moving information surfaces between earnings events, reshaping expectations before quarterly reporting cyclesInterim data updates offer early insight into demand, production, and profitability across key industriesMonitoring interim events helps investors anticipate volatility, refine forecasts, and manage portfolio riskMacroeconomic volatility feels like it has been ratcheted up a few notches in recent years. Stock prices, interest rates, commodity trends, and currency pairs turn on a dime, while ...

If an inverted yield curve is a harbinger of a near-term recession, then a steeper yield curve must be good news, right? Not so fast. Before unpacking that, let’s lay a bit of foundation just in case you don’t follow the shape of various yield curves very closely. Yield curve basics in 100 words: The yield curve is a measurement of bond yields of various terms from a few months to many years. Most often it has a positive slope, meaning 10-year yields are higher than 2-year yields. Locking your money up ...

With only 13% of companies reporting thus far, S&P 500 EPS growth for Q4 2025 currently stands at 8.2%The tech sector continues to dominate, Despite a significant earnings-related slide from Intel, the Information Technology sector remained the market’s primary engine, lifted by an ongoing “AI supercycle” and strong results from names like Meta and NetflixPotential earnings surprises this week: Union Pacific, NextEra Energy, Texas Instruments, UnitedHealth Group, American Express and Regeneron Pharmaceuti ...

Market Overview - The trading week began with significant market declines, influenced by geopolitical tensions and new tariffs, leading to a spike in the Cboe Volatility Index (VIX) above 20 and the U.S. Dollar Index (DXY) experiencing its worst session since August [1] - Japan's bond market faced a severe downturn, with the 40-year yield reaching a record high above 4.20% and the 30-year rate increasing by 27 basis points to 3.88%, raising concerns about the fiscal impact of tax cuts [2] Energy Sector Performance - The energy sector emerged as a standout performer, with 10 of the 11 S&P 500 sectors trading in the red, while energy stocks showed resilience [4] - Exxon Mobil (XOM) reached a record high above $131, demonstrating strong performance despite overall depressed oil prices [5] - Oil prices have been under pressure due to a global oil glut, with WTI and Brent crude prices affected by President Trump's policies and OPEC's struggles to stabilize the market [6] Natural Gas Market Dynamics - The natural gas market experienced volatility, with the February 2026 contract of U.S. Henry Hub gas surging nearly 30% due to forecasts of severe cold weather [7] Upcoming Earnings Reports - Baker Hughes (BKR) is set to report its Q4 earnings, with shares hovering near record highs ahead of the unusual weekend earnings event [11] - The market anticipates limited volatility from BKR's upcoming report, with expected stock movement around 4.8% [12] - Major energy companies, including Halliburton (HAL), SLB Corp (formerly Schlumberger), Exxon Mobil, and Chevron, are scheduled to report earnings soon, with a focus on their insights regarding the volatile global energy market [13] Geopolitical Considerations - The situation in Venezuela remains complex, with the country's oil reserves likely overstated and the oil being of lower quality, complicating U.S. investment prospects [14][15] - Despite challenges, Chevron's existing assets in Venezuela could be optimized for better extraction in the future [15] Investment Trends - Energy stocks, particularly XOM and CVX, have outperformed the S&P 500, with both companies up nearly 9% in 2026, attracting income investors due to their dividend yields [16] - The Energy Select Sector SPDR ETF (XLE) leads among S&P 500 sector funds, up over 6% year-to-date, providing diversification amid macroeconomic volatility [16]

Group 1 - The "Big Six" US banks (JPM, BAC, C, WFC, MS, GS) reported strong Q4 2025 profits, with half of them missing revenue expectations due to one-time charges [1] - Investment banking showed a resurgence, and loan demand remained strong despite falling interest rates and significant restructuring charges [2] - Most banks exceeded EPS estimates, but market reactions were muted or negative due to cautious 2026 guidance and rising operational costs related to AI investments [3] Group 2 - Bank of America reported a 12% profit increase driven by record net interest income, while JPMorgan and Citigroup managed one-time cleanup costs to signal a clearer path forward [4] - As of now, 7% of S&P 500 companies have reported results, with a blended EPS growth rate of 8.2% and revenue growth expectations rising to 7.8% [5] - The Late Earnings Report Index (LERI) indicates that CEOs are more confident than ever, with a record low reading of 46 for Q4 earnings season [6][8] Group 3 - The peak earnings season for Q4 is expected to run from January 26 to February 27, with over 1,000 reports anticipated each week [11] - Upcoming earnings releases include 35 S&P 500 companies and 577 companies in the global universe of 11,000 equities [9]

The price of oil is pretty much near a five-year low, in a world where everything costs much more than it used to.Thankfully, our cars don’t run on gold. Before delving into the Canadian energy space and the developments in Venezuela, here’s a brief synopsis from our reading, research, and thinking on oil.First, there’s too much oil in the world as we move into 2026, with both supply and demand sharing the blame. Supply has increased thanks largely to a few mega projects ramping up (e.g., the facilities ...

Earnings season gets underway this week, with reports from major banks providing the first look at corporate performanceThe technology sector is expected to be the standout performer with over 25% projected earnings growth, driven by the ongoing “AI arms race”Sectors that rely on lower-end consumer spending are expected to be squeezed again by “value-conscious” shoppers, making the consumer discretionary sector a laggard this seasonThe Q4 2025 earnings season for US corporations begins this week when big ...

Inflation Trends - Inflation has continued to cool, with World Economy Weighted Inflation decreasing from 4.4% to 3.3% in 2025, aided by low supply chain pressures and moderated wage growth [1][4] - The setup for an inflationary spike similar to 2021/22 is not present, as global money growth is rising but velocity is falling [2] Economic Conditions - Inflation in the 2-4% range is favorable for equities, providing companies with pricing power and top-line growth, but concerns arise when inflation approaches 4% [3] - The U.S. faces higher inflation risks due to aggressive fiscal spending, erosion of central bank independence, and a positive output gap, while other countries like Germany, Japan, France, and Canada have negative gaps [4][5] Long-term Inflation Outlook - Inflation has eroded purchasing power by over 20% in the past four years, and while portfolio returns have kept pace, long-term inflation is expected to be higher and more volatile than in the 2010s [6] - Secular factors are becoming more inflationary, with globalization trends shifting from disinflationary to inflationary due to tariffs and supply chain diversification [7] Policy and Debt Implications - Erosion of central bank independence poses risks for monetary policy effectiveness, particularly in the U.S. and some developing countries, while fiscal spending is rising globally, which may increase inflation [8] - Total debt is disinflationary as it crowds out investment, and significant levels of debt exist in the economy [9] Technological Impact - Technology that enhances productivity is generally disinflationary, but current capital expenditures on AI infrastructure are inflationary, contributing to inflationary cyclicality [10] Investment Strategies - To mitigate the risks of higher and more volatile inflation, equities, especially those with dividend growth, are recommended as a defense, along with real asset exposure [11]