Wells Fargo’s Darrell Cronk: We see one rate cut in 2025 and one in 2026

Interest Rate Outlook - Wells Fargo anticipates one rate cut in 2025 and one in 2026, suggesting a neutral rate around 100 basis points above inflation [3] - Piper Sandler suggests the economy needs rate cuts to broaden fundamental breadth beyond the largest companies and wealthiest consumers [7][13] - The market is already at all-time highs, priced for only a couple of cuts [4] Economic Indicators and Analysis - The economy is bifurcated, with housing and small caps showing weakness, while S&P 500 profits are at new highs [6][7] - US PMIs remain broadly in contraction territory [6] - Unemployment at 41%, and Q2 GDP tracking around 25% do not indicate an immediate need for Fed rate cuts [9] - Positive year-over-year earnings growth suggests no imminent recession or material slowdown [10] Earnings Growth - Consensus is tracking 5% to 6% earnings growth for Q2, potentially reaching 7% to 9% with beats, following Q1's 15% earnings growth [11] Market Performance - NASDAQ is at an all-time high, with Nvidia's market cap exceeding $4 trillion [1] - The market exhibits narrowness, with concerns about smaller companies and lower-income consumers being left behind [8][13]