Bank of England Governor Andrew Bailey appeared to endorse market pricing betting on a 50% chance of an interest-rate cut in March after a more dovish-than-expected decision to maintain the cost of borrowing this month https://t.co/8vCKABlBtt ...

Core Viewpoint - The iShares U.S. Regional Banks ETF (IAT) has reached a 52-week high, increasing by 58.07% from its 52-week low of $38.30 per share, indicating strong momentum and potential for further gains [1]. Group 1: ETF Overview - IAT tracks the Dow Jones U.S. Select Regional Banks Index, which is a market capitalization-weighted index focused on the regional bank sector of the U.S. equity market [2]. - The ETF charges an annual fee of 0.38% [2]. Group 2: Market Drivers - The regional banking sector is gaining attention due to rising expectations for an interest rate cut in 2026, following the nomination of Kevin Warsh as Fed Chair, who is anticipated to support rate reductions and a leaner Fed balance sheet [3]. - This policy environment could lead to a steepening of the yield curve, which would benefit the regional banks and the ETF [3]. Group 3: Performance Outlook - IAT currently holds a Zacks ETF Rank of 3 (Hold) and has a high-risk outlook, but it may continue its strong performance in the near term [4]. - The ETF has a positive weighted alpha of 23.68, suggesting potential for further price appreciation [4].

Group 1: Market Overview - Wall Street sold technology stocks as investors take profits amid increasing market volatility, with the Nasdaq up over 90% in the past three years [1] - The bullish market backdrop remains intact, with strong earnings growth projected for 2026 and expectations of interest rate cuts by the U.S. Federal Reserve [2] Group 2: Investment Strategy - Investors can utilize a Zacks screen to identify top Zacks Rank 1 (Strong Buy) stocks from over 200 highly-ranked companies [3] - Zacks Rank 1 stocks have historically outperformed the market, averaging an annual return of approximately 24.4% since 1988 [6] Group 3: Stock Screening Parameters - The screening parameters include a Zacks Rank of 1, positive current quarter estimate revisions, and top broker rating changes over the last four weeks [7][8] Group 4: Featured Stock - ServisFirst Bancshares, Inc. (SFBS) - ServisFirst Bancshares, Inc. is highlighted as a top-ranked finance stock, focusing on business and personal banking services across multiple states [9][10] - The company is projected to grow revenue by 20% in 2026 and 9% in the following year, boosting adjusted earnings by 22% and 10%, respectively [12] - SFBS shares have increased by 370% over the past decade, outperforming the Finance sector's 165%, and are on the verge of breaking out of a trading range [13] - Despite its strong performance, SFBS trades at a 25% discount to its sector and 20% below its own 10-year median, with a dividend yield of 1.8% [14]

Economic Indicators - The Eurozone January S&P manufacturing PMI was revised upward by +0.1 to 49.5 from the previously reported 49.4, indicating slight improvement in manufacturing activity [1] - The US January ISM manufacturing index rose +4.7 to 52.6, surpassing expectations of 48.5, marking the strongest pace of expansion in over 3.25 years [3] - German December retail sales increased by +0.1% month-over-month, aligning with expectations, while November retail sales were revised upward to -0.5% from -0.6% [6] Currency Movements - The euro is under pressure, down by -0.33% against the dollar, attributed to a stronger dollar despite the upward revision of the Eurozone manufacturing PMI [1] - The dollar index (DXY) rose by +0.57%, reaching a 1-week high, supported by President Trump's nomination of Keven Warsh as the next Fed Chair, who is perceived as more hawkish [5] - USD/JPY increased by +0.49%, with the yen falling to a 1-week low due to comments from Japanese Prime Minister Takaichi regarding the benefits of a weak currency for export industries [7] Central Bank Policies - The FOMC is expected to cut interest rates by about -50 basis points in 2026, while the BOJ is anticipated to raise rates by +25 basis points, and the ECB is expected to maintain current rates [2] - The markets are pricing in an 11% chance of a -25 basis point rate cut by the FOMC at the next policy meeting on March 17-18 [2] - The BOJ's January 22 policy meeting summary indicated a hawkish stance, with a focus on addressing rising prices, although the market discounts a rate hike at the next meeting on March 19 [9] Precious Metals Market - April COMEX gold is down -18.80 (-0.40%), while March COMEX silver is up +0.459 (+0.58%), reflecting mixed performance in precious metals [10] - Gold prices are pressured by a stronger dollar and easing geopolitical risks, while silver prices received support from the strong ISM manufacturing report [11] - Central bank demand for gold remains strong, with China's PBOC reserves increasing by +30,000 ounces to 74.15 million troy ounces in December, marking the fourteenth consecutive month of increases [16]

Core Viewpoint - President Donald Trump nominated Kevin Warsh to lead the Federal Reserve, succeeding Jerome Powell, amid a divided Federal Open Market Committee [1] Group 1: Kevin Warsh's Background and Views - Warsh served on the Fed's Board of Governors from 2006 to 2011, during the U.S. financial crisis, and was previously viewed as a hawk favoring high interest rates to control inflation [2] - Recently, Warsh has shown a more dovish stance, aligning with Trump's calls for further easing of the Fed's benchmark federal funds rate [2] - Warsh has criticized the Fed's quantitative easing measures and has suggested a need for reform regarding the Fed's role in markets [3] Group 2: Nomination Process and Challenges - Warsh's nomination is expected to face a confirmation process that includes approval from the Senate Banking Committee and a full Senate vote [4] - The confirmation may be complicated by opposition from Sen. Thom Tillis, who has vowed to oppose any of Trump's Fed nominations until the Justice Department concludes its investigation into Powell [4] Group 3: Market Expectations - There is an expectation that Warsh will drive reforms in the Fed's approach to market interventions, although his response to future crises or inflation remains uncertain [3]

Core Viewpoint - The Federal Reserve's decision to maintain interest rates reflects ongoing inflation concerns and a stabilizing economic environment, impacting market expectations for future rate cuts [1][5]. Group 1: Federal Reserve's Decision - The Federal Reserve held interest rates steady, reversing previous market expectations for an early 2026 rate cut [1]. - Job gains have remained low, and the unemployment rate shows signs of stabilization, while inflation remains elevated [1]. - There were two dissents regarding the decision, with some members preferring a 25 basis points cut [1]. Group 2: Market Reactions - Bitcoin remained just under $89,500, and U.S. stocks showed little change following the Fed's decision [2]. - The U.S. dollar was sharply higher after a previous decline, and gold prices increased by 3.7%, nearing record levels at $5,300 per ounce [2]. - Market participants have adjusted their expectations, with nearly 99% pricing in no change in rates, effectively removing near-term easing expectations [3]. Group 3: Future Rate Cut Expectations - Market participants do not expect the Fed to resume rate cuts at the next meeting in March, with odds at just 16%, and slightly higher at about 30% for April [4]. - The Fed's decision has led to expectations of continued restrictive policy through the first quarter of the year [3]. Group 4: Implications for Risk Assets - The Fed's decision may lead to near-term volatility in crypto markets, as liquidity remains supportive [5]. - Investors are looking for insights from Jerome Powell's post-meeting press conference, particularly regarding a cautious 'higher-for-longer' stance [5].

Core Insights - The Federal Reserve is expected to maintain interest rates during the upcoming meeting, with indications that rate cuts are not imminent [1] - Fed officials have expressed confidence in the current policy stance, suggesting a readiness to respond to economic data but signaling no urgency for immediate cuts [1][3] - The labor market shows signs of softness, with payroll growth remaining weak, while inflation continues to exceed the Fed's target [1][2] Inflation Data - The core Consumer Price Index (CPI) for December remains at 2.6%, consistent with levels from September to November, indicating persistent inflation above the Fed's 2% goal [1] - The core Personal Consumption Expenditures (PCE) index for November shows a higher inflation rate of 2.8%, reflecting ongoing inflationary pressures [2] Internal Fed Dynamics - There is a division among Fed officials regarding future rate cuts, with some members advocating for a steady approach to control inflation [3] - New voting members of the Fed, including presidents from Cleveland, Dallas, and Minneapolis, are expected to support maintaining current rates [4] - Key figures such as Powell and other senior officials have reiterated that the policy is in a favorable position, suggesting a cautious approach moving forward [4]

Core Insights - The Federal Reserve has cut the federal funds rate three times in 2025, leading to a decline in deposit rates, making it crucial for consumers to seek high-yield savings accounts to maximize interest earnings [1][5]. Group 1: High-Yield Savings Accounts - High-yield savings accounts offer significantly higher interest rates compared to traditional savings accounts, with rates reaching up to 4% APY [2][3]. - The average savings account rate is only 0.39%, while the best high-yield savings rates are around 4% to 4.5% APY [3]. - As of January 28, 2026, the highest savings account rate available is 4% APY, offered by institutions like SoFi, Barclays, and Valley Direct [4]. Group 2: Interest Rate Trends - Deposit account rates are closely tied to the federal funds rate; when the Fed lowers its target rate, deposit rates typically decrease [4][5]. - Following multiple interest rate hikes in response to inflation, the Fed's recent cuts have resulted in a continued downward trend in deposit rates throughout 2025 [5][6]. - Experts predict that further rate cuts may occur, suggesting that savings account rates will likely continue to decline [6]. Group 3: Considerations for Savings Accounts - When evaluating savings options, factors such as interest rates, financial goals, accessibility, and security should be considered [7]. - High-yield savings accounts are suitable for short-term savings goals, providing a secure place to hold funds while earning competitive interest [7][8]. - Savings accounts are generally insured by the FDIC, offering a low-risk option for consumers [8].

The latest US Federal Open Market Committee meeting gets under way Tuesday, culminating with an announcement on interest rates Wednesday afternoon (13:00 CT). A look at the Fed fund futures forward curve shows the market is expecting US Fed Chairman Powell to announce no change in rates, leaving it between 3.5% and 3.75%, shifting the spotlight to the March (17 and 18), April (28 and 29), and June (16 and 17) meetings. Amidst all that, Jerome Powell’s term as Chairman comes to an end in May meaning the U ...

Summary of the January FOMC Preview Industry Overview - The document discusses the Federal Open Market Committee (FOMC) and its monetary policy decisions, particularly regarding the federal funds rate and labor market conditions. Key Points and Arguments - The January FOMC meeting is expected to be uneventful, with no change to the fed funds rate, which remains at 3.5-3.75% [2][3] - Chair Powell is anticipated to emphasize the recent three rate cuts aimed at stabilizing the labor market, indicating that the FOMC is well-positioned to assess their impact [5][6] - There is a consensus among 15 of 19 FOMC participants that additional rate cuts may be appropriate eventually, but the leadership seeks a stronger consensus for future cuts compared to the last cut in December [11][19] - The next expected rate cut is projected for June, followed by another in September, bringing the rate down to a range of 3-3.25% [18][22] - The risks over the next year or two are viewed as tilted to the downside, with hikes being unlikely, but potential reasons for additional cuts include a lower terminal rate or an increase in the unemployment rate [19][22] Labor Market Insights - The labor market is expected to stabilize this year, with an anticipated unemployment rate of 4.5% [6][7] - Job growth appears insufficient to keep pace with labor supply growth, indicating potential challenges ahead [6] - The stability of the unemployment rate since September is seen as a positive sign, but job growth remains a concern [6][8] Inflation Considerations - FOMC participants have differing views on inflation progress, with some focusing on core PCE inflation estimates that are close to 2%, while others rely on official numbers that may remain closer to 3% in the near term [15][17] - A firmer consensus for future cuts will require more convincing progress on inflation, which may take time to materialize [15][19] Additional Important Content - The document includes various exhibits illustrating job growth trends and inflation forecasts, which support the analysis presented [9][10][21] - The FOMC's approach to monetary policy is characterized by a cautious stance, reflecting the current economic uncertainties and the need for a careful assessment of labor market conditions and inflation data [2][19]