Core Viewpoint - Bank of America CEO Brian Moynihan expressed that while the bank can adapt to the rise of stablecoins, there are significant concerns regarding the potential movement of up to $6 trillion in deposits into stablecoins, which could negatively impact the broader banking system by reducing lending capacity and increasing borrowing costs [1][6][7] Group 1: Stablecoins and Banking System Impact - Moynihan highlighted that the shift of deposits into stablecoins could lead to a reduction in banks' lending capacity, as deposits are essential for funding loans [7] - The American Bankers Association (ABA) has echoed these concerns, urging lawmakers to address "dangerous loopholes" in stablecoin legislation that allow issuers to offer yield-like incentives, potentially diverting savings from traditional banks [5] - The GENIUS Act, aimed at establishing a federal framework for stablecoin issuers, has faced criticism from banks for not including stronger regulations to prevent stablecoins from acting as interest-bearing deposit substitutes [4] Group 2: Legislative Context and Industry Reactions - RBC Capital Markets analyst Gerard Cassidy raised questions about whether U.S. lawmakers would address a "looming loophole" that could allow stablecoin deposits to pay interest, which is currently restricted [3] - The Senate has been debating provisions to adjust this loophole in a crypto market structure bill, but progress has stalled following Coinbase's withdrawal of support [3] - There is a divide in the banking sector regarding the risks posed by stablecoins, with some institutions, like JPMorgan, downplaying the systemic risk associated with stablecoins drawing savings onto blockchains for higher yields [8]

Market Overview - U.S. equities opened with a mixed but generally positive tone, driven by strong earnings from the semiconductor sector and easing geopolitical tensions [1] - The S&P 500 Index rose to 6,969.46 points, a 0.62% gain, while the Nasdaq Composite Index surged to 23,693.97 points, up 0.95% [2] - The Dow Jones Industrial Average opened at 49,201.10 points, reflecting a 0.10% increase [2] Semiconductor Sector - Taiwan Semiconductor Manufacturing Company (TSM) reported a 35% surge in fourth-quarter profit, exceeding analyst estimates and marking its seventh consecutive quarter of double-digit growth [3] - TSM's U.S.-listed shares jumped 5.5% at the opening, with ASML Holding NV shares soaring 7%, pushing its market capitalization above $500 billion [3] - Other chip-related stocks, including Nvidia and Advanced Micro Devices, also saw gains of 2% and 3.8%, respectively [3] Banking Sector - Major financial institutions, including BlackRock, Goldman Sachs, and Morgan Stanley, reported earnings, with BlackRock exceeding expectations in revenue and assets under management [4] - Goldman Sachs beat earnings expectations but fell short on revenue, while Morgan Stanley advanced 3.3% after topping forecasts [4] - Wells Fargo shares sank 4.6% after reporting weaker-than-expected quarterly results, contributing to pressure on the broader banking sector [4] Economic Indicators - The Federal Reserve's monetary policy remains a focal point, with a 95% likelihood of interest rates remaining unchanged in January and expectations for one or two rate cuts in 2026 [5] - The U.S. Census Bureau released data indicating a 0.6% increase in retail sales for November, driven by auto sales recovery and holiday shopping [6] - Existing home sales rose 5.1% in December, reaching a nearly three-year high [6] Geopolitical Developments - Oil prices fell significantly, with U.S. benchmark crude down 4.5% to $59.13 per barrel, attributed to easing tensions surrounding Iran [8] - Gold futures slipped as fears of military action against Iran decreased, reducing demand for safe-haven assets [8] - The U.S. dollar index rose 0.3% to 99.38, reflecting changes in the geopolitical landscape [8] Summary - The stock market shows resilience in the technology sector, particularly in semiconductors, driven by strong earnings [9] - The banking industry faces challenges, and investors are closely monitoring economic data and the Federal Reserve's interest rate stance [9] - Geopolitical developments are impacting commodity prices, adding complexity to the market outlook [9]

Core Viewpoint - The individual investor adopts a contrarian investment style, focusing on deep value opportunities, particularly in stocks that have recently experienced sell-offs due to non-recurrent events, while also considering insider buying as a positive signal [1] Investment Strategy - The investment portfolio is split approximately 50%-50% between shares and call options, indicating a balanced approach to risk and potential returns [1] - The investor's timeframe for holding positions typically ranges from 3 to 24 months, suggesting a medium-term investment horizon [1] - Fundamental analysis is employed to assess the health of companies, including their leverage and financial ratios compared to sector and industry averages [1] Stock Selection Criteria - The investor screens thousands of stocks, primarily in the US, looking for those that have undergone recent sell-offs, particularly when insiders are purchasing shares at lower prices [1] - Professional background checks are conducted on insiders who buy shares post-sell-off, adding a layer of due diligence to the investment process [1] Technical Analysis - Technical analysis is utilized to optimize entry and exit points, with a focus on support and resistance levels on weekly charts, employing multicolor lines for clarity [1] - Trend lines are drawn in multicolor patterns, indicating a systematic approach to technical analysis [1]

Core Viewpoint - January 2026 presents opportunities in U.S. marijuana penny stocks, particularly for companies with real assets and retail exposure, as they tend to attract longer-term interest [1] Group 1: FLUENT Corp. (CNTMF) - FLUENT Corp. is a multi-state cannabis operator with a significant retail presence, focusing on branded cannabis products across regulated markets [2] - Florida is the largest market for FLUENT, operating over 30 dispensaries in the state, which supports steady demand due to its medical-only structure [3] - The company is reducing reliance on a single market by maintaining exposure in New York, Pennsylvania, and Texas, while also closing underperforming stores to improve margins [4] - Financially, FLUENT has shown stability with flat year-over-year revenue, though pricing pressure has impacted gross margins [5] - The company has adequate cash levels for operations, but elevated debt remains a concern [6] Group 2: Glass House Brands (GLASF) - Glass House Brands focuses on large-scale cultivation in California, aiming to lower costs and ensure consistent wholesale supply [6] - The company operates around 10 dispensaries in California, which enhance brand visibility and provide higher-margin opportunities [9] - Heading into January 2026, Glass House aims to normalize production levels, which could lead to improved revenue trends [11] - Recent financial results indicate a transition period with declining revenue and negative adjusted EBITDA, but cash levels remain solid [12][13] Group 3: Cresco Labs (CRLBF) - Cresco Labs is a well-established cannabis operator with a national scale, combining wholesale brand strength with a large retail footprint [13] - The company operates over 70 Sunnyside dispensaries nationwide, with Florida being a key growth market [14] - Cresco's diversification in branded wholesaling helps balance weaker pricing environments, making it more resilient than smaller peers [15] - As of January 2026, Cresco is noted for its consistency, with steady revenue and strong profitability metrics compared to competitors [17] - The company has improved its balance sheet through debt refinancing, maintaining supportive cash levels despite ongoing net losses [18] Group 4: Market Outlook - January 2026 could be an active period for marijuana penny stocks, with FLUENT offering turnaround potential, Glass House focusing on production recovery, and Cresco providing stability at a discounted price [19]

Financial Performance - Bank of America reported a net income of $7.6 billion for the fourth quarter of fiscal 2025, a decrease from $6.80 billion a year ago, with an EPS of 98 cents, surpassing the analyst consensus estimate of 96 cents [1] - Revenue, net of interest expense, increased by 7% year-over-year to $28.532 billion, exceeding the analyst consensus estimate of $27.944 billion [1] Management Commentary - CEO Brian Moynihan stated that the company delivered on commitments to shareholders with solid growth across revenue, earnings, and returns [2] Stock Performance - Following the earnings announcement, Bank of America shares rose by 0.2% to trade at $52.59 [2] Analyst Ratings and Price Targets - Keefe, Bruyette & Woods analyst Christopher McGratty maintained an Outperform rating but lowered the price target from $64 to $63 [3] - Piper Sandler analyst Scott Siefers maintained a Neutral rating and raised the price target from $56 to $57 [3] - Truist Securities analyst John McDonald maintained a Buy rating and lowered the price target from $62 to $60 [3]

The rise in global interest rates that began in 2022 has been a game changer for the banking sector. However, it was only really in 2025 that the return of steeper yield curves was wedded to the deregulatory agenda of President Donald Trump and a rerating and repricing of banks began in earnest. ...

Core Viewpoint - The major U.S. banks reported significant profit growth in Q4, driven by sustained borrower demand, indicating a robust economic environment and optimistic future profitability for lending institutions [1]. Group 1: Bank Performance - Bank of America reported an 8% year-over-year increase in average loans, with net interest income soaring to a record $15.9 billion [1]. - JPMorgan Chase experienced a 9% growth in average loans, reflecting strong lending activity as a positive indicator for the banking sector and overall economy [1]. - Citigroup's average loan amount grew by 7% in Q4, supported by its market and personal banking services [2]. - Wells Fargo's commercial loans surged by 12% in Q4, with increased revenue from auto loans and credit cards [2]. Group 2: Economic Outlook - Analysts from S&P Global expressed optimism for sustained economic growth into 2026, attributing this to macroeconomic stability and favorable lending conditions, with a projected 5.3% loan growth by the end of 2025 [2]. - Bank of America anticipates a moderate single-digit percentage loan growth rate in 2026, despite challenges from tariffs and geopolitical tensions [1]. Group 3: Challenges and Concerns - Potential obstacles for lending institutions include geopolitical tensions and policy uncertainties, particularly regarding a proposed cap on credit card interest rates at 10% [3]. - Executives expressed concerns that such a cap could lead to a contraction in lending, negatively impacting economic growth [4]. - Citigroup's CFO noted that assessing the potential impact of the interest rate cap is premature due to the lack of specific implementation details [4]. Group 4: Federal Reserve Independence - Bank executives emphasized the importance of the Federal Reserve's independence for economic stability, with calls for the next Fed chair to maintain this independence [5]. - Concerns were raised about political interference in the Fed, which could lead to increased inflation expectations and higher interest rates over time [5].

Group 1 - The fourth quarter earnings season has commenced with reports from Delta Air Lines and JPMorgan Chase, with more bank earnings expected later in the week [1][5] - Wall Street analysts predict an 8.3% earnings per share growth rate for S&P 500 companies in Q4, marking the 10th consecutive quarter of annual earnings growth if realized [2] - Analysts have increased earnings expectations for tech companies, which have been significant contributors to earnings growth in recent quarters, with a prior estimate of 7.2% for Q4 [3] Group 2 - The earnings season will test the improved stock market breadth observed at the beginning of 2026, with ongoing themes such as artificial intelligence and economic policies from the Trump administration influencing market dynamics [4] - Major financial companies scheduled to report earnings this week include Bank of New York Mellon, Bank of America, Citigroup, Wells Fargo, BlackRock, Goldman Sachs, and Morgan Stanley [5]

Now you can get access to the latest and highest-quality analysis of recent Wall Street buying and selling ideas with just one subscription to Beyond the Wall Investing ! There is a free trial and a special discount of 10% for you. Join us today!The last time I updated my bullish coverage on Bank of America ( BAC ) was in late December. I liked the bank's trends in operating leverage, and IDaniel Sereda is chief investment analyst at a family office whose investments span continents and diverse asset classe ...

Core Viewpoint - The article discusses the bullish outlook on Bank of America (BAC), highlighting its positive trends in operating leverage and investment potential [1]. Group 1: Company Analysis - Bank of America has shown favorable trends in operating leverage, which is a key indicator of its financial health and efficiency [1]. - The analysis is part of a broader investment strategy that includes insights from institutional market participants, emphasizing the importance of high-quality data in investment decisions [1]. Group 2: Analyst Background - The chief investment analyst, Daniel Sereda, has extensive experience in navigating diverse asset classes and extracting critical investment ideas from a vast amount of information [1]. - The investment group, Beyond the Wall Investing, provides access to analysis that aligns with institutional priorities, indicating a focus on high-quality investment insights [1].