🇺🇸 US CPI will be released tomorrow at 8:30am ET.The market expectations are at 3.1%, while last month's CPI was at 2.9%.Here are different scenarios:1⃣ CPI > 3.1%This will be bearish for markets.This is because it'll mark the highest CPI print since June 2024.2⃣ CPI = 3.1%This will be in line with the expectations but still somewhat bearish.This is because it'll show a 0.2% MoM CPI increase, which is 2.4% annualized CPI.And the Fed target inflation is 2%, which means Powell could become a bit hawkish.3⃣ CP ...

Welcome back. It's a pretty good Thursday on the Street of Dreams. You got stocks up across the board.The S&P's up threequarters of 1%. NASDAQ up 1% and today really just continuing a rally for the ages. The S&P 500 is basically doubled off its intraday low exactly 5 years ago.The Nasdaq 100 though says, "Hold my beer, it's up 128% in just 60 months." This market along with crypto and maybe even gold have hopefully made a lot of people like you very rich. The fear is that at some point stocks stop going up ...

Hotter CPI Unlikely to Deter Rate Cuts - For Now - Bloomberg Surveillance https://t.co/KJzfRZmDnQ ...

Monetary Policy - JPMorgan expects the Federal Reserve to end quantitative tightening next week [1] - Rate cuts are anticipated [1] - Money printing is potentially on the horizon [1] Market Outlook - Bitcoin is expected to rise above $100,000 [1]

‼️ Money market funds just hit an all-time high of $7.4 TRILLION99% chance the Fed cuts rates in 6 days.Rate cuts will push treasury holders to seek more risk, driving liquidity into Bitcoin and other assetsLiquidity tsunami incoming 🌊 🌊 🌊 https://t.co/LEozSuzd1g ...

Core Insights - The fixed income ETF market has seen significant inflows, surpassing $325 billion as of mid-October, indicating strong investor interest [1] - Market uncertainty is prevalent, particularly regarding interest rates, with a high probability of two rate cuts by the Fed before 2026 [2][3] - Municipal bonds (munis) are attracting investors due to their tax-free income and low default rates, making them an appealing option in the current market [4][5] Fixed Income Market Trends - The fixed income ETF market is experiencing record inflows, suggesting a shift in investor preferences [6][7] - Northern Trust's muni funds offer competitive expense ratios, with each fund priced at five basis points, which is significantly lower than the segment average [5] - The concept of "flippening" is introduced, predicting that fixed income ETFs will eventually surpass equity ETFs in assets over the next five to ten years [7] Municipal Bonds - Muni ETFs are benefiting from attractive yields and strong credit fundamentals, with federal tax-free income being a primary draw for investors [3][4] - Northern Trust offers three muni funds that cover the full yield curve, catering to different investment horizons [6] - The low default rates in the muni market further enhance their appeal to investors seeking stable returns [4]

Market Environment - The current credit market is very active, with record pipelines and earnings across the board, indicating a strong cycle for credit despite some expected hiccups [2][4]. - The uncertainty that previously affected the market, such as tax policy and tariffs, has largely been resolved, allowing for increased business activity including M&A and IPOs [4][5]. Economic Outlook - The market is believed to be in the earlier innings of a positive cycle, with expectations of continued growth into 2026, barring any significant geopolitical events [5]. - There is a caution regarding Federal Reserve policy, suggesting that while some rate cuts may be necessary, the idea of multiple significant cuts is not supported [6][10]. Investor Behavior - A generational divide exists in investment perspectives, with older investors focusing on performance while younger investors prioritize interaction through social apps and do not view performance as a primary concern [11][12]. - The blending of prediction markets with investing is seen as problematic, emphasizing the need for education on the differences between investing and gambling [13].

Market Overview & Strategy - The market is considered expensive, especially among top companies, suggesting a rotation into defensive stocks [3] - A defensive strategy within equities involves shifting from expensive high-flyers like the MAG7 to sectors like healthcare and telecom [6] - The analyst favors healthcare and telecom for potential outperformance due to depressed valuations and potential interest rate cuts [6][7] Company Specifics & Earnings - Thermofisher is expected to beat earnings, with potential for increased earnings growth [7][8] - Thermofisher trades at approximately 24-25 times forward earnings, which is in line with valuation but not deeply undervalued [8][9] - Thermofisher's consistency in earnings and diversification make it a desirable investment, with less volatility than biotech [10] Economic Outlook & Influences - CPI data is expected later in the week, with some anticipating it to be around 3%, above the inflation target [11] - Rate cuts are viewed as a bonus rather than a necessity, though lower long-term and mortgage rates would be beneficial [11][12] - Strong earnings are expected across the S&P 500, with expectations raised rather than lowered heading into the earning season [13] - Productivity gains, potentially from AI implementation, are expected to contribute to growth across various companies [14]

We are of course getting into the heart of earnings season. Black Rockck's Rick Reer, he was with me yesterday on closing bell. He said the setup remains really good.Listen, >> I think there's a couple things at play. One, you've got an economy that's operating at a pretty good level. I mean, you just said printed or we think you're you printed second quarter GDP 38.Third quarter, we think it's running 33. You got an economy that's operating at a pretty good level. And you've got a Fed that's got to bring b ...

Summary of Key Points from the Conference Call Industry Overview - The S&P 500 is projected to achieve a third consecutive year of returns exceeding 20%, driven by advancements in AI and anticipated rate cuts [1][1] - The current market momentum remains robust despite renewed US-China trade tensions, with high price-to-earnings (PE) valuations [1][1] Core Themes Identified 1. **AI Propagation** - Rapid adoption of AI technologies is evident, with capital expenditure (capex) from major hyperscalers expected to remain high, indicating a long growth runway [2][21] - AI-related companies are projected to achieve a compound annual growth rate (CAGR) of 17.3% in earnings from 2026 to 2027 [2][21] - Key sub-themes include energy infrastructure, NeoCloud, hardware infrastructure, and compute (chips) [2][28] 2. **Onshoring/Reshoring Enablers** - The primary goal of tariffs is to incentivize manufacturing to return to the USA, which is expected to be a significant theme moving forward [3][3] - Companies already reporting increased revenues are being screened for potential investment opportunities [3][3] 3. **Rate Cuts** - Rate cuts typically align with economic downturns; however, the current economy is strong, suggesting that small-cap companies with high floating-rate debt will benefit the most [4][4] - Companies with significant floating-rate debt and upcoming maturities are being targeted for investment [4][4] 4. **Weak Dollar** - A weak dollar is anticipated to favor US stocks, particularly those with revenues in foreign currencies [5][5] - Companies in the semiconductor, tech hardware, and high-performance computing sectors are highlighted for their foreign sales exposure [5][5] 5. **Two-Paced Economy** - The economy is characterized by strong performance in tech, defense, and industrial sectors, while real GDP growth is expected to slow [6][6] - Companies with domestic revenues that correlate with the US economy are being screened for potential risks [6][6] 6. **De-dollarization** - There is a notable increase in the use of cryptocurrencies and gold as alternatives to the dollar, particularly among retail and central banks [7][7] 7. **Defensive Yield** - A focus on low-volatility, high-dividend yield stocks is recommended as a hedge against ongoing uncertainties, particularly related to US-China relations [7][7] 8. **Momentum** - Identifying stocks with no exposure to momentum and those with poor momentum is crucial for investment strategy [7][7] 9. **Horses for Courses** - An empirical study is used to identify the best valuation and fundamental factors for each industry, guiding long and short selections [7][7] 10. **ROIC Stars** - Companies with high and rising return on invested capital (ROIC) are favored, while those with peaking ROIC are to be avoided [7][7] Additional Insights - The performance of various themes indicates that crypto and gold have been the best-performing baskets, while poor momentum and peaking ROIC have lagged [16][16] - The thematic investing approach is increasingly significant, with AI being a standout driver of equity performance this year [21][21] - The top four hyperscalers (Microsoft, Amazon, Google, Meta) are expected to maintain high capital intensity, reflecting aggressive investment strategies [21][21] Conclusion - The conference call highlighted a range of investment themes and strategies that are expected to shape the market landscape, particularly focusing on AI, reshoring, and macroeconomic factors such as rate cuts and currency fluctuations. The emphasis on screening for companies aligned with these themes presents potential investment opportunities while also identifying risks associated with economic shifts.