Core Viewpoint - The yen has experienced a modest decline following the Liberal Democratic Party's (LDP) significant electoral victory, which may lead to increased fiscal stimulus under Prime Minister Sanae Takaichi [1][2]. Currency Movement - The yen dropped 0.3% to 157.62 per dollar, marking its weakest level in over two weeks [2]. - The LDP secured a two-thirds super majority in the 465-seat lower house, the highest proportion of representatives for any party in post-war Japan [2]. Fiscal Policy Implications - Concerns regarding Japan's fiscal spending have intensified, particularly after Takaichi's announcement of a temporary sales tax cut on food, raising fears about the country's debt levels [3]. - A decisive electoral victory is expected to bolster expectations for proactive fiscal policy, which may encourage short-term selling of the yen [4]. Market Reactions - Further declines in the yen could approach levels where Japanese authorities previously intervened, with traders monitoring the 159.45 per dollar mark reached in mid-January [5]. - Japanese officials are more focused on currency volatility and the pace of movements rather than specific exchange rate levels [5]. Monetary Policy Expectations - Persistent weakness in the yen is influencing expectations for the Bank of Japan's policy, with increasing speculation about a potential rate hike by April [6]. - The yen's recent decline has been exacerbated by comments from Takaichi, suggesting that a weaker currency could benefit export industries [7]. Intervention Speculations - Analysts anticipate rising verbal interventions as the USD/JPY approaches 159, with actual intervention likely to occur closer to 162 [8].

The yen was little changed after Japan’s ruling Liberal Democratic Party won an outright majority in Sunday’s lower house election, opening the door to more fiscal stimulus by Prime Minister Sanae Takaichi https://t.co/7vyIVrKLz6 ...

Core Viewpoint - Woodward Inc. has seen its shares rally to an all-time high following a strong earnings report, indicating robust performance in the aerospace and industrial sectors [1][6]. Company Overview - Woodward Inc. is a long-established company founded around 1870, specializing in manufacturing components for the aerospace and industrial sectors, including energy control equipment and parts for electricity turbines [4]. - The company serves a diverse range of customers, including major players in the aerospace industry such as Rolls-Royce, Boeing, and RTX, as well as sectors like defense, marine, transportation, and oil and gas [5]. Financial Performance - The company reported earnings per share (EPS) of $2.17, significantly surpassing the estimated $1.65, with total sales reaching $996 million compared to an estimate of $893 million, marking a 29% year-over-year increase [6][9]. - Sales in the industrial segment increased by 30%, while aerospace sales rose by 29%, reflecting strong market demand [7]. - Woodward has raised its earnings guidance for fiscal year 2026, with the higher end of the EPS range increasing from $8.00 to $8.60, representing a 7.5% increase [8]. Market Position and Growth Drivers - The company is well-positioned within the energy, aerospace, and industrial sectors, which continue to outperform in the current economic climate [2][3]. - Analysts have adjusted their earnings estimates upward, with Deutsche Bank setting a target of $430, UBS at $417, and Truist at $390, indicating positive market sentiment [15]. Margin and Scalability - Woodward's gross margins are around 27%, with net interest margins improving by approximately 300 basis points over the last five years, suggesting enhanced scalability and net income growth [10][11].

Economic Outlook - The economy is perceived to be strong, with expectations of significant demand due to recent tax cuts taking effect this year [4] - Predictions for GDP growth in Q1 and Q2 range between 3% to 4%, with some estimates suggesting up to 4% growth due to substantial fiscal and monetary stimulus [9][10] - The Federal Reserve is not expected to change interest rates in the near term, indicating a continuation of current economic policies [3] Fiscal and Monetary Policy - The Federal Reserve has re-engaged in quantitative easing at a rate of $40 billion per month, contributing to a stimulative economic environment [5] - There is pressure for further stimulus in an election year, which may influence economic policies and growth [5] - Real interest rates are currently below 1%, suggesting a highly accommodative monetary policy [5] Inflation Concerns - Inflation is anticipated to rise following the election, influenced by ongoing fiscal stimulus unless measures are taken to mitigate it [11] - The relationship between high growth rates and inflation is acknowledged, with concerns that inflation may follow economic growth more slowly but could become challenging to control once it accelerates [11]

Rocked by growth-sapping shocks, countries around the world are rolling out large fiscal stimulus packages financed by bumper budget deficits https://t.co/zY6S6DUWYE ...

Summary of China Banks Conference Call Industry Overview - The conference call focused on the Chinese banking sector, particularly the impact of recent monetary and fiscal policies on banks' performance and loan growth. Key Points Monetary Policy Changes - The People's Bank of China (PBoC) announced new supportive monetary policies on January 15, including: - Expansion of relending facilities with an additional quota of approximately RMB 1.1 trillion, targeting private enterprises and key industries such as agriculture, small businesses, technological innovation, carbon reduction, service consumption, and elderly care [1] - A 25 basis points (bps) interest rate cut for relending facilities, reducing the rate from 1.5% to 1.25% [7] - Potential for further cuts in the Reserve Requirement Ratio (RRR) and Loan Prime Rate (LPR) [1][2] Impact on Banks' Net Interest Margin (NIM) - The relending facilities rate cut is expected to benefit banks' NIM by approximately 0.3 bps, as banks can borrow cheaper funds from PBoC [1] - The balance of relending facilities reached around RMB 5 trillion by Q3 2025, representing about 1% of banks' total assets [1] - The anticipated fiscal stimulus, including interest subsidies on consumer and micro loans, is expected to have a limited negative impact on banks' NIM [1] Loan Growth Expectations - The stimulus measures are designed to incentivize banks to direct credit towards policy-favored sectors, supporting loan growth at the beginning of 2026, coinciding with the start of the 15th five-year plan [1] - Stronger than expected loan growth is anticipated in early 2026 due to targeted lending rate cuts [1] Treasury Bond Market Dynamics - Lower treasury bond yields are expected to widen the spread between banks' dividend yields and the 10-year China treasury bond yield, attracting yield-seeking investors [2][5] - The PBoC may actively participate in treasury bond trading to rebalance supply and demand dynamics, potentially lowering treasury bond yields [2] Investment Opportunities in China Banks - China banks' H-shares have underperformed the Hang Seng Index by 7 percentage points year-to-date in 2026, but there are expectations for recovery due to: - Increased premium growth from insurers, leading to more inflows into high-yield bank stocks [6] - Lower treasury bond yields enhancing the attractiveness of banks' dividend yields [6] - Monetary and fiscal stimulus benefiting loan growth with limited negative impact on NIM [6] - Specific banks highlighted for investment include: - ICBC-H and BOC-H due to their attractive dividend yields and valuations [6] - BONB-A and CSRCB-A for better-than-expected export performance and potential interest subsidies [6] Additional Insights - The conference call emphasized the importance of monitoring the evolving regulatory environment and its implications for banks' operations and profitability [6] - The potential for Ping An Insurance to increase its stake in BOC-H was noted, as it has been removed from the restricted investment list since October 2025 [6] Conclusion - The Chinese banking sector is poised for potential growth driven by supportive monetary policies and fiscal measures, with specific banks identified as attractive investment opportunities based on their dividend yields and market positioning.

The New Year celebrations continue in the investing world. The S&P 500 (^GSPC) is near a record. The Nasdaq Composite (^IXIC) is near a record. The Dow Jones Industrial Average (^DJI) is knocking on the door of breaking through 50,000 for the first time. "The rally is broadening out — and that’s exactly what you want to see at this stage of the cycle," SlateStone Wealth chief market strategist and Yahoo Finance contributor Kenny Polcari said. "More stocks (think the other S&P 500 names) are participating ...

Core Insights - Casey's General Stores, Inc. (NASDAQ:CASY) is recognized as one of the best dividend stocks to invest in for January [1] - Wells Fargo has added Casey's to its Q1 2026 Tactical Ideas list, indicating a favorable outlook for the company [2] - The company is expected to exceed near-term EPS expectations, supported by its growth strategy and fiscal stimulus [3] Financial Performance - Goldman Sachs raised its price target for Casey's from $490 to $530, citing strong Q2 EPS performance that surpassed both its estimates and consensus [4] - The positive results were attributed to better-than-expected fuel margins and effective execution on inside margins [4] Company Overview - Casey's operates approximately 2,900 convenience stores across 19 states, offering self-service fuel, grocery items, and freshly prepared food options [5]

Labor Market and Economic Outlook - The labor market remains stable, with jobless claims consistently between 200,000 and 240,000, indicating no overheating but also no deterioration, setting a positive outlook for 2026 [2] - A dovish rate environment could potentially reverse job losses attributed to technology [2][3] Federal Reserve and Inflation - The Federal Reserve is expected to lower the Fed funds rate to the low 3% range, supported by a favorable inflation report and downward pressure from housing costs on the CPI [3] - The CPI is projected to remain in the low 2% range, allowing for further rate reductions by the Fed [3] Fiscal Stimulus and Tax Policy - Changes in tax policy may provide fiscal stimulus, benefiting both individuals and corporations through larger refunds and lower tax rates [4] - Upcoming Supreme Court rulings regarding tariffs and potential government shutdowns could disrupt the economic landscape, impacting the effectiveness of fiscal policies [5][6] Balancing Risks and Tailwinds - The economic outlook is characterized by a balance of positive factors, such as tax refunds and lower gas prices, against negative factors like potential student loan payments resuming and expiring ACA subsidies [7] - The ACA subsidies are a significant political issue, with implications for the upcoming midterm elections, affecting healthcare costs and overall economic sentiment [8] Housing Market - Rental and home prices have stabilized, with no longer experiencing double-digit inflation, although they remain expensive for many Americans [9]

The roaring 20s are alive and well. That according to our next guest, Ed Yard Denny. He's the president of Yard Denny Research.He joins us now. It's good to see you. So, we were just a little delayed on the roaring 20s, maybe thanks to co and here we are about to regroup.>> Well, I think we've been doing pretty well since uh since the beginning of the of the decade. I mean, think of all the uh shocks that the economy has been hit by the pandemic, the lockdowns for two months. Uh then the social distancing, ...