Geopolitical Impact - The U.S. captured Maduro in Venezuela, leading to a generally positive response in the stock market, particularly in the oil and defense sectors [3][5][6] - Canadian oil stocks are negatively impacted due to competition with Venezuelan heavy crude, which could lower prices for Canadian oil sands [4] - Defense stocks are rising due to geopolitical tensions and potential contracts for infrastructure development in Venezuela [5][6] Market Trends - Memory and storage stocks have surged, with Sandisk up 36% in the past week and 71% in the past month, indicating a high demand for memory chips driven by AI developments [10][11] - Companies like Oklo and Vistra are gaining attention as they provide alternative power solutions for data centers, reflecting the growing need for energy in the tech sector [12][13] - Caterpillar's stock is also rising as demand for equipment to build data centers increases [14][15] Labor Market Insights - The unemployment rate held steady at 4.4%, with a slight increase of 50,000 jobs in December, indicating a stagnant job market [17][19] - The labor participation rate has decreased, suggesting some individuals may have exited the workforce [18] - There is a notable shift where individuals with coding skills may need to transition to construction roles to support data center development [21][26] Company-Specific Developments - Roblox's stock has declined by about 10% in the past week and 45% since its last earnings report, attributed to new age verification requirements for chat, which may hinder user participation [27][28][30] - The company faces public pushback and lawsuits regarding safety concerns on its platform, highlighting the need for self-regulation in the tech industry [29][30] Economic Indicators - The upcoming CPI report and earnings from major financial institutions like Citi and Bank of America will provide insights into economic activity and consumer spending [33][34] - The trucking firm JB Hunt's earnings report will also serve as an economic indicator, reflecting overall market conditions [35] Future Market Outlook - The year 2026 is viewed as a pivotal year for the market, with ongoing debates about whether the AI sector is in a bubble, as many stocks are trading at high valuations [37][39] - External geopolitical events, such as tensions with China and the situation in Ukraine, will likely influence market dynamics throughout the year [40][41] - The political landscape, including the upcoming midterms, may set the tone for market behavior in the latter half of the year [42][43]

Core Viewpoint - The anticipated Santa Claus rally did not occur, but January has started positively for certain technology companies [1] Group 1 - The performance of tech stocks has shown signs of recovery at the beginning of January [1]

WAVE IS UP NEARLY 20% IN THE PAST WEEK. THEY JOINED THE DEPARTMENT OF ENERGY'S GENESIS MISSION. SO IS THE AI TRADE BACK FOR GOOD THIS TIME, OR WILL THIS RALLY FADE AGAIN.LET'S ASK GENE MUNSTER. HE'S MANAGING PARTNER AT DEEPWATER ASSET MANAGEMENT. AND GENE, I'M CURIOUS WHAT YOU THINK.I HAVE A THEORY, BUT I WANT TO KNOW WHAT YOURS. WHAT YOU THINK IS GOING ON HERE. I MEAN, TO ME, IT SEEMS LIKE A LOT ACTUALLY IMPROVED SENTIMENT AFTER OPENAI DID THAT MASSIVE RAISE LAST WEEK AFTER SAM ALTMAN CAME OUT AND DEFENDED ...

Summary of Telecom & Networking Equipment Conference Call Industry Overview - The conference call focused on the **Telecom & Networking Equipment** industry in **North America** with a specific emphasis on the **AI trade** and **optical componentry** market [1][3][4]. Key Points 1. Performance Metrics - Networking returns in 2025 were concentrated in AI and optical trades, with a **100% return YTD** for optical [1]. - The overall networking universe returned approximately **55% YTD**, outperforming NASDAQ by about **35%** [3]. - AI names saw a **110% increase** in returns, building on an **85% return** from the previous year [3]. 2. AI Trade and Optical Market - The AI trade has broadened beyond semiconductor names, positively impacting infrastructure, particularly in optical [3]. - Optical components led the AI basket performance with a **155% increase** and **40% estimate revisions** [3]. - The expectation is that the AI trade will continue, especially in optical, through the first half of 2026, but selectivity will be necessary for full-year returns [4]. 3. Investment Recommendations - Upgrades were made for **MSI** to Overweight (OW), with continued OW ratings for **AXON**, **CSCO**, and **ANET** [1][4]. - Companies expected to attract excess returns from the AI trade include **GLW**, **CIEN**, **LITE**, and **COHR** [4]. - Core networking names like **CSCO** and **ANET** are highlighted as attractive opportunities due to Ethernet's growing market share [5][9]. 4. Caution on Pricing and Market Dynamics - There is caution regarding the sustainability of pricing in the optical market due to increased competition and capacity investments [4]. - If capital expenditure (capex) data points continue to be revised positively, expectations for optical names may hold throughout the year [4]. 5. Public Safety Sector - The public safety sector, particularly companies like **AXON** and **MSI**, is viewed as well-positioned for growth due to high public safety budgets and the impact of OBBBA funding [10][60]. - Despite recent underperformance, there is optimism for recovery in public safety names as demand conditions improve [10][11]. 6. Company-Specific Insights - **Cisco (CSCO)** is expected to benefit from a multi-year campus upgrade cycle and increased AI contributions, with a price target raised to **$91** [34][37]. - **AXON** is projected to maintain a durable growth opportunity with a price target of **$713**, reflecting a strong market position in public safety [50][56]. - **MSI** was upgraded to OW with a price target of **$436**, citing reasonable valuation levels and growth drivers in public safety [60][71]. - **Ciena (CIEN)** is experiencing strong demand but is currently trading at a premium, leading to a cautious outlook despite positive near-term demand [72][74]. 7. Risks and Considerations - Risks include potential tariff impacts, macroeconomic uncertainties, and the timing of public safety spending [56][71]. - The optical component market faces challenges from increased competition and supply chain issues, which could affect pricing and margins [95][96]. Conclusion The conference call highlighted a robust outlook for the Telecom & Networking Equipment industry, driven by AI and optical components, while also emphasizing the need for selectivity in investments due to market dynamics and pricing pressures. The public safety sector remains a focal point for growth, with several companies positioned to capitalize on favorable funding and demand conditions.

FRESH AI TRADE JITTERS. AI TRADE JITTERS. TODAY WE'LL DISCUSS AND DEBATE WITH THE INVESTMENT COMMITTEE.JOINING ME FOR THE HOUR TODAY, STEVE WEISS, JIM LEBENTHAL, BRENDA ANGELO AND KEVIN SIMPSON. SURE. THERE'S THE INTRODUCTION WE JUST SHOWED YOU THE OTHER MAJOR AVERAGES, WHICH HAVE ALL GONE DECIDEDLY RED, ESPECIALLY THE NASDAQ.LET'S SHOW THAT BECAUSE THAT'S WHERE THE PAIN REALLY IS. THAT HEADLINE THAT ORACLE IS DELAYING SOME OF ITS DATA CENTERS FOR OPEN AI TO 2028 FROM 2027. THE DELAYS ARE SAID TO BE WEISS, ...

We're going to take a look at some of the technical levels in the markets and the close the year and what we'll be watching next year. Joining us now, Gareth Soloway, chief market strategist at Verified Investing. Gareth, thanks so much for being with us today.You know, we are seeing a bit of a pullback in the markets today ahead of the Fed meeting kicking off tomorrow. You know, any thoughts on the recent action and also what to expect coming into this week. Yeah.So, I mean, it's very interesting that we s ...

It's the most wonderful time of the year: Wall Street prediction season. Bank strategists are weighing in on where they see the S&P 500 landing by the end of 2026. BI's Jennifer Sor has a roundup of what the top Wall Street firms are projecting.My colleague, Joe Ciolli, author of the fantastic First Trade newsletter, has already written extensively about these predictions. I figured it made sense to chop it up with him. Dan: Before we get into what Wall Street is predicting for 2026, let's get into why (o ...

Well, post Thanksgiving, markets are back in riskoff mode this morning. Equities seemingly stuck between possible Federal Reserve doubbishness and the risk aversion signals being sent by the crypto markets. Joining me now, Steve Sausnik, Interactive Brokers chief strategist.Steve, it's great to see you. Thanks for being with us. Hope you had a great holiday.Um, let's talk about the sort of push and pull in the markets here because, you know, we're getting these signals that maybe Kevin Hasset's going to be ...

Dow industrials add more than 600 points, biggest gain since August. ...

Federal Reserve Insights - The Federal Reserve is considering a hawkish cut in December, with little change in economic conditions since the last meeting [2] - Current projections indicate core PCE at approximately 3.1% for the year, while unemployment is approaching 4.5%, suggesting potential for further risk management cuts [3] - The impact of a 25 basis point cut on the S&P 500 has been noted, raising questions about the effectiveness of such cuts moving forward [4] Private Credit Market Analysis - The focus is shifting towards private credit, particularly concerning vintage risk from deals made in 2021 and 2022, which may face challenges due to changing rate environments [6] - There is a concern regarding liquidity in private credit markets, as many investors assumed these structures were liquid, which they were not [7] - Defaults are expected at the margins, particularly affecting lower-income consumers, while overall credit quality remains stable [8] Market Conditions and Credit Quality - Recent data indicates high insurance costs for autos and homes, which could signal areas for credit quality deterioration [9] - Default rates in the market remain relatively low, between 2% and 3.5%, with an emphasis on the importance of more frequent monthly marks for assessing credit quality [11] - Aggregate credit quality has held up, but questions around marks and liquidity are becoming increasingly significant [12]