Economic Outlook - Pre-market futures are up following all-time closing highs from the S&P 500 and Nasdaq, driven by optimism around potential rate cuts by the Federal Open Market Committee (FOMC) [1] - U.S. Treasury Secretary suggested a 50 basis points cut in the Fed funds rate, which would lower rates to 3.75-4.00%, a level last seen in December 2022 [2][1] - July Inflation Rate reported at +2.7%, alleviating concerns about tariffs re-igniting inflation [2] Inflation and Price Trends - Current inflation is below +2.0%, with sub-3.0% inflation expected to be absorbed by the economy without significant disturbance [3] - Concerns arise about potential inflation increases if interest rates decrease while tariffs rise, with projections of 2-3 rate cuts leading to a Fed funds rate of 3.50-3.75% amid rising inflation [4] - Recent CPI report showed food prices steady, gasoline down -9.5%, and used cars and trucks up +4.8%, indicating a core CPI at a 5-month high [4] Producer Price Index (PPI) Expectations - Upcoming PPI report for July is projected to show +0.2% on headline and +0.3% on core, indicating potential tariff effects before retailers adjust prices [5] Company Earnings - Brinker International (EAT) reported fiscal Q4 earnings of $2.49 per share, exceeding expectations and showing significant growth from $1.61 per share year-over-year [6] - Revenues of $1.46 billion surpassed estimates by +2%, with a +16% growth in restaurant traffic [7] - Maggiano's Little Italy franchise saw a slight decline of -0.4%, but Chili's experienced exceptional growth of +24% year-over-year [7] Market Expectations - Cisco Systems (CSCO) is expected to report earnings after the closing bell, with shares up +20% year-to-date and projected earnings growth of +11.5% year-over-year [8]

Market Overview - Major indexes on Wall Street have reached multiple all-time closing highs recently, but have experienced volatility due to uncertainties surrounding President Trump's new tariffs and potential inflation increases [1][4] - The ongoing volatility may persist as market participants are concerned about the economic impact of the tariffs and rising inflation [2][6] Dividend-Paying Stocks - Dividend-paying stocks are recommended as they tend to perform better during market volatility, providing a steady income stream and reducing the risk of sharp price swings [2][3] - Historically, companies that pay dividends have outperformed non-dividend-paying companies during periods of market instability [3] Specific Companies and Their Dividends - **Pan American Silver Corp. (PAAS)**: Announced a dividend of $0.12 per share with a yield of 1.25% and a payout ratio of 26%. The company has increased its dividend four times in the past five years [9][10] - **Carlisle Companies Incorporated (CSL)**: Declared a dividend of $1.10 per share with a yield of 1.09% and a payout ratio of 20%. The company has increased its dividend six times over the last five years [12][10] - **DHT Holdings, Inc. (DHT)**: Announced a dividend of $0.24 per share with a yield of 5.25% and a payout ratio of 56%. DHT has increased its dividend seven times in the past five years [14][10]

Core Viewpoint - The financial sector, particularly certain stocks like Berkshire Hathaway, Bank of America, and Wells Fargo, presents attractive investment opportunities despite being overshadowed by technology stocks [1][2][10]. Group 1: Company Valuations - Berkshire Hathaway has reached a market cap of $1 trillion, making it the largest financial company, with its core business in insurance and a significant stock portfolio valued at $300 billion [2][4]. - Bank of America reported a 7% year-over-year earnings growth and a 5% increase in customer deposits, indicating strong performance in a challenging consumer environment [5]. - Wells Fargo, now free from its asset cap, is positioned to benefit from falling interest rates, enhancing its consumer-focused business model [6][10]. Group 2: Market Conditions and Regulatory Environment - Both Bank of America and Wells Fargo could benefit from a potential reduction in corporate tax rates and a generally looser regulatory environment under the Trump administration [7]. - The financial sector is experiencing a shift, with interest rates expected to fall, which could positively impact banks like Bank of America and Wells Fargo [5][6]. Group 3: Comparisons with Other Financial Companies - JPMorgan Chase, while a strong institution, trades at a premium valuation compared to Bank of America and Wells Fargo, which may limit its attractiveness [8]. - Visa and Mastercard, despite being dominant players in the payment processing market, have high P/E ratios of 33 and 39, raising questions about their future growth potential [8].

押注美联储下月降息的债券投资者正面临一个潜在障碍：通胀。 周二将发布的7月消费者价格指数（CPI）将为交易员提供线索，揭示特朗普的关税政策如何影响成 本。彭博社调查的经济学家预计，核心通胀年率将升至3%，为2月以来最高水平。 "市场正寻求进一步确认：贸易政策调整是否已传导至商品通胀上升，"道明证券（TD Securities）美国 利率策略主管根纳季·戈德堡（Gennadiy Goldberg）表示，"其他条件不变的情况下，更高的通胀数据可 能会让美联储希望在降息前看到更多数据。" 降息压力渐增 上月美联储维持利率不变后，鲍威尔重申，官员们需要更多时间评估关税影响后再降息，这表明在特朗 普持续施压要求降息的背景下，他仍保持耐心。 摩根大通策略师周一表示，若CPI数据符合市场预期，9月美国通胀保值国债（TIPS）多头头寸的"票息 收益（carry）"可能转为负值，并补充称在数据公布前，他们对盈亏平衡通胀率持中性态度。 然而，物价快速上涨的风险是美联储主席鲍威尔以及华尔街部分人士的心头大患。美国银行、阿波罗全 球管理公司和纽约梅隆银行近期报告均将滞胀列为重大担忧。 高通胀与经济增长疲软并存，也对美元构成风险——美 ...

Core Insights - Intercorp Financial Services Inc. (IFS) is expected to report second-quarter 2025 results on August 11, with anticipated year-over-year earnings growth driven by higher revenues despite increased provisions for credit losses and expenses [1][10]. Revenue Factors - A significant portion of IFS's revenue comes from spread income, and a recent 25 basis point cut in Peru's benchmark interest rate to 4.50% is expected to support loan demand [3]. - The company is likely to have experienced a decline in deposit costs, contributing to an increase in net interest and similar income, as well as an expansion in net interest margin due to lower deposit repricing [4]. - Strong asset inflows from a decent equity market performance are expected to enhance IFS's assets under management, benefiting its wealth management operations and increasing net fee income from banking services and credit card activity [5][10]. Expense Factors - Higher salaries, employee benefits, and administrative expenses are anticipated to keep the expense base elevated, alongside increased costs related to the company's digitization efforts [6][10]. Earnings Expectations - The consensus estimate for IFS's earnings is $1.07 per share, reflecting a 62.1% increase from the previous year [2][10]. - The company's earnings surprise history shows it has surpassed the Zacks Consensus Estimate in four of the last five quarters, with an average beat of 17.26% [2]. Zacks Model Insights - The quantitative model indicates that IFS lacks the necessary combination of positive Earnings ESP and a Zacks Rank better than 3 (Hold) for a conclusive prediction of an earnings beat this time [7][8].

Group 1: Labor Market Insights - The labor market in the U.S. is showing signs of weakness, with only 73,000 jobs added in July and an unemployment rate rising to 4.2% [2] - The three-month average job gains have dropped to just 35,000, indicating a slowdown in hiring [2] - Fed President Mary Daly expressed concern that further slowing in the labor market could lead to a rapid decline [2] Group 2: Inflation and Tariffs - Tariffs are expected to temporarily increase inflation, but Daly does not foresee a lasting impact [3] - Underlying inflation, excluding tariffs, has been gradually decreasing and is expected to continue this trend due to restrictive monetary policy and a slowing economy [3] Group 3: Federal Reserve's Stance - Fed Chair Jerome Powell has stated that no decision has been made regarding a potential rate cut in September, emphasizing the need to monitor tariff impacts closely [4] - New York Fed President John Williams acknowledged the job market remains solid but expressed concern over downward revisions in hiring [4] Group 4: Investment Opportunities in Growth Stocks - Growth stocks are likely to perform better in a low-rate environment, as lower borrowing costs facilitate company expansion [5] - The attractiveness of fixed-income investments diminishes with lower rates, prompting investors to seek higher returns in equity markets [5] Group 5: Recommended ETFs - Several top-ranked growth-based exchange-traded funds (ETFs) are highlighted for potential investment if the Fed begins cutting rates: - Vanguard Growth ETF (VUG) – Zacks Rank 1 (Strong Buy) [6] - Invesco S&P 500 Pure Growth ETF (RPG) – Zacks Rank 2 (Buy) [6] - Invesco Large Cap Growth ETF (PWB) – Zacks Rank 1 [6] - Vanguard S&P 500 Growth ETF (VOOG) – Zacks Rank 1 [6] - iShares S&P 500 Growth ETF (IVW) – Zacks Rank 1 [6]

The Federal Reserve's July FOMC meeting came and passed precisely as expected: without any change to its benchmark effective federal funds rate (EFFR). Chairman Jerome Powell and the other Fed governors noted their post-meeting press release that the central bank will be holding its EFFR steady in the 4.25% to 4.50% range, noting that "uncertainty about the economic outlook remains elevated." The financials sector sold off on the news despite the announcement being largely anticipated by economists and Wall ...

Economic Overview - The U.S. economy added only 73,000 jobs in July, significantly below the expected 104,000, with downward revisions in May and June erasing a total of 258,000 jobs, marking the largest two-month revision since May 2020 [1] - The unemployment rate increased to 4.2%, aligning with forecasts but remaining near historic lows [1][2] Market Reactions - Wall Street analysts are reassessing their economic forecasts due to the disappointing July jobs report, indicating a potential loss of strength in the labor market [2] - Following the weak labor market data, market expectations for a Federal Reserve interest rate cut in September surged to 80%, up from 38% the previous day [3] Federal Reserve Insights - Leslie Falcone from UBS Global Wealth Management anticipates the Fed will begin cutting rates in September, with a total of about 100 basis points in consecutive cuts [4] - Fed officials had previously expressed concerns about labor market softness, which now appear to be validated [5] Trade Tensions - Recent escalations in trade tensions, including a surprise 39% tariff on Switzerland by President Trump, have added to investor uncertainty, catching markets off guard [6] Investment Strategies - In light of economic uncertainty, investors are advised to consider defensive exchange-traded funds (ETFs) that may provide stability [7] - Specific ETFs mentioned include: - Invesco QQQ Low Volatility ETF (QQLV), which tracks low volatility stocks within the Nasdaq-100 Index and charges 25 basis points in fees [8] - Cullen Enhanced Equity Income ETF (DIVP), focusing on large-cap, dividend-paying companies with a yield of 7.31% and charging 55 basis points in fees [9] - S&P 500 Dividend Aristocrats ETF (NOBL), targeting companies with a history of increasing dividends for at least 25 years, charging 35 basis points in fees [10] - First Trust Utilities AlphaDEX Fund (FXU), designed to identify stocks from the Russell 1000 Index that may generate positive alpha, charging 63 basis points in fees [11][12] - US Aerospace & Defense iShares ETF (ITA), measuring the performance of the aerospace and defense sector, charging 40 basis points in fees [13]

Financial Data and Key Metrics Changes - The second quarter results were in line with expectations, showing a rebound in Advanced Materials, which offset sluggish construction activity and tariff uncertainties, particularly in polyurethanes [5][6] - Positive cash flow was generated in the second quarter, despite a $25 million EBITDA impact due to aggressive inventory and working capital management [7] Business Line Data and Key Metrics Changes - Advanced Materials showed normalized earnings, while construction activity remained weak, impacting overall performance [5][6] - Polyurethanes utilization rates were reported in the low to mid-80s percentile, with North America slightly higher than China [11][20] Market Data and Key Metrics Changes - Order books in July were described as stable, with customers ordering just in time due to low inventories [14][15] - The automotive sector in China continues to perform well, contrasting with struggles in Europe and North America [20][21] Company Strategy and Development Direction - The company remains focused on maintaining a strong balance sheet and prudent capital spending, emphasizing value creation over volume [6][8] - There is an ongoing review of the asset portfolio, with a focus on bolt-on acquisitions in Advanced Materials rather than in the more volatile polyurethane sector [43][44] Management's Comments on Operating Environment and Future Outlook - Management expressed cautious optimism about potential improvements in construction and consumer confidence, particularly in the long term [6][30] - The impact of tariffs and trade disputes remains a concern, with management advocating for clarity in trade policies to reduce volatility [35][40] Other Important Information - The closure of the Maleka anhydride facility was attributed to a lack of competitiveness in the European market, with the decision made after exploring all options [58][59] - The company does not foresee new MDI plants being built under current market conditions, citing sufficient existing capacity [48][102] Q&A Session Summary Question: MDI utilization rates in the second quarter and expectations for the third quarter - Management indicated that the industry is operating in the low to mid-80s percentile, with North America slightly higher and China lower [11][20] Question: Update on order books in July - Management described the situation as stable, with customers ordering just in time due to low inventories [14][15] Question: Thoughts on the dividend - The board is carefully considering the dividend, focusing on cash generation and market conditions, with no immediate changes expected [26][30] Question: Impact of trade finality on customer behavior - Management noted that volatility is the primary concern, and customers prefer clarity in trade policies to stabilize purchasing behavior [35][40] Question: Future of the European footprint and MDI facility - Management believes the Rotterdam facility will remain competitive for several years, despite market challenges [60][61] Question: Price declines in polyurethanes - A 5% year-over-year price decline was noted, primarily driven by competitive dynamics in Europe [89] Question: Expectations for MTBE margins - Management indicated that MTBE typically performs best during driving seasons, but struggles are expected to continue through the end of the year [113]

Group 1 - The Federal Reserve is considering a significant interest rate cut from the current range of 4.25%-4.5% to 3%, a reduction of 125-150 basis points, due to inflation nearing targets and stagnation in private sector job growth [3][4] - Nvidia's founder announced the approval for AI chip exports to China, leading to a surge in Nvidia's stock price and a market capitalization exceeding $4.1 trillion, highlighting the interplay between finance and technology [1][3] - The internal division within the Federal Reserve is becoming apparent, with some officials advocating for rate cuts while others express concerns about potential long-term inflation due to tariffs [3][4] Group 2 - Trump's call for a drastic 300 basis point rate cut and the suggestion of firing Fed Chair Powell has led to market volatility, with predictions of Powell's dismissal rising significantly [4][6] - The 30-year U.S. Treasury yield has surpassed 5%, indicating a potential long-term high-interest rate environment, alongside a national debt of $37 trillion [8][11] - Inflation data shows a core CPI increase of 2.9% year-on-year, exceeding the Fed's 2% target, with businesses planning to pass on tariff costs to consumers, raising concerns about stagflation [8][11]