Company Updates - Saks Global, a luxury retailer, has filed for Chapter 11 bankruptcy protection after running out of cash, allowing it to reorganize its business and manage debts [3] - Former Neiman Marcus CEO Geoffroy van Raemdonck has been appointed as the new CEO of Saks, succeeding Richard Baker, who held the position for only two weeks [4] - Saks has secured a financing commitment of approximately $1.75 billion, which is crucial for its restructuring efforts [4] Industry Insights - The core reading of December's consumer price index showed a monthly gain of 0.2% and an annual increase of 2.6%, which was lower than economists' expectations of 0.3% and 2.7% respectively [6] - The producer price index, a key indicator of wholesale cost growth, is set to be released soon, providing further insights into inflation trends [6] - Meta is shifting focus from virtual reality to artificial intelligence, resulting in a 10% staff reduction in its Reality Labs unit, equating to over 1,000 jobs [11]

Quick Read Stocks were walloped on Tuesday after JPMorgan missed analysts’ fourth-quarter earnings estimates. The good news on Tuesday was the December consumer price index report that showed inflation hitting the 2.7% target, while core inflation came in below estimates at 2.6% Investors will be watching the other big banks that will report this week after the somewhat worrisome JPMorgan print. A recent study identified one single habit that doubled Americans’ retirement savings and moved retireme ...

Group 1 - The 2.8% Social Security cost-of-living adjustment (COLA) is insufficient for retirees as it does not keep pace with inflation in essential spending categories like healthcare and groceries [2][7] - Walmart's 30% stock gain indicates strong pricing power in grocery essentials, highlighting the disparity between national inflation averages and the actual cost pressures faced by fixed-income households [3][7] - Utility companies and healthcare providers are raising rates, which disproportionately affects fixed-income households, as they cannot easily reduce spending on these necessities [4][7] Group 2 - Dividend income for retirees is not keeping pace with inflation; AT&T's 4.5% yield has remained stagnant for four years, while Duke Energy's dividend growth is only 1.9% annually [5][7] - The choice for retirees is between locking in stagnant high-yield dividends or accepting lower starting yields from companies with better growth prospects, indicating a challenging investment environment [5][6] - A focus on sustainable growth rather than high starting yields is emphasized by dividend investors, suggesting that payout ratios are more critical than yield alone [6]

Core Viewpoint - Gold miners Newmont and Barrick experienced pre-market trading increases of 1.4% and 1.6%, respectively, driven by a surge in precious metals prices [1] Group 1: Market Reaction - Precious metals, particularly silver, saw a significant price increase, with silver rising above $90 an ounce [1] - The rise in precious metals prices was influenced by softer-than-expected U.S. inflation data [1] - Geopolitical risks are contributing to the upward trend in precious metals [1]

Core Viewpoint - Silver prices have reached an all-time high of $91.564 per ounce, driven by steady U.S. inflation and geopolitical instability, raising concerns about a potential market bubble reminiscent of the 1980 crash [1][2][5]. Group 1: Price Movement and Market Drivers - Silver spot prices surged to $91.564, with a daily increase of 3.84% to $90.2635, trading within a resistance zone of $90.15–$92.40 [2]. - The rally is attributed to a "perfect storm" of supportive macroeconomic data and increased safe-haven demand due to global uncertainties, including civil unrest in Iran [2][3]. - Softer-than-expected U.S. inflation data, with Core CPI steady at 2.6% year-on-year, has led to expectations of Federal Reserve rate cuts in 2026, further supporting silver prices [3]. Group 2: Historical Context and Caution - Historical comparisons indicate caution, as silver prices have tripled over the past year, marking the most aggressive year-over-year gain since early 1980 [4]. - The 1980 rally ended in a significant market crash, with prices collapsing over 50% in a single session on "Silver Thursday" and losing 90% of their value by 1982, raising fears of a similar overheating in the current market [5]. Group 3: Technical Analysis - Key technical levels for silver include immediate support between $86.10 and $84.75, with a critical ceiling at $92.40 that traders are monitoring [6]. Group 4: Investment Opportunities - Performance of silver and silver mining-linked ETFs over various time frames shows significant gains, with notable examples including: - iShares Silver Trust (NYSE:SLV): 126.97% over 6 months, 188.97% over one year - abrdn Physical Silver Shares ETF (NYSE:SIVR): 127.10% over 6 months, 189.45% over one year - Global X Silver Miners ETF (NYSE:SIL): 87.32% over 6 months, 187.55% over one year - Amplify Junior Silver Miners ETF (NYSE:SILJ): 105.24% over 6 months, 204.74% over one year [7].

Core Insights - Consumer inflation does not indicate a potential rate cut in January, suggesting that monetary policy may remain tight in the near term [1] - Banks are increasingly opposing the implementation of a cap on credit card interest rates, indicating a potential shift in the financial services landscape [1] - The technology sector is actively addressing the increased power consumption associated with AI, highlighting a growing concern over sustainability and operational efficiency [1] Group 1: Consumer Inflation - Consumer inflation trends are not signaling a forthcoming rate cut in January, which may impact investment strategies and market expectations [1] Group 2: Banking Sector - Banks are joining forces to resist a proposed cap on credit card interest rates, which could affect profitability and lending practices within the industry [1] Group 3: Technology Sector - The technology industry is focusing on the power usage of AI technologies, reflecting a commitment to sustainability and the need for efficient energy consumption [1]

Economic Data - The U.S. consumer prices rose +0.3% month-over-month in December, with annual inflation at +2.7%, consistent with expectations [1] - Core CPI, excluding food and fuel, increased by +0.2% month-over-month and +2.6% year-over-year, which was below expectations of +0.3% and +2.7% respectively [1] - U.S. new home sales fell -0.1% month-over-month to 737K in October, surpassing expectations of 716K [1] Market Performance - Wall Street's major indexes closed lower, with software stocks declining after Anthropic's new tool announcement, leading to Salesforce dropping over -7% and Adobe falling more than -5% [2] - Credit card companies also saw declines, with Visa down over -4% and Mastercard dropping more than -3% following President Trump's proposal for a cap on credit card interest rates [2] - Moderna's shares surged over +17% after the CEO announced plans for a combined flu and COVID-19 vaccine launch within two years [2] Corporate Earnings - The fourth-quarter corporate earnings season is underway, with major U.S. banks like Bank of America, Wells Fargo, and Citigroup set to report [7] - S&P 500 companies are expected to see an average quarterly earnings increase of +8.4% for Q4 compared to the previous year [7] Federal Reserve Insights - The Federal Reserve is expected to maintain current interest rates, with a 97.2% probability of no change and a 2.8% chance of a 25 basis point cut at the January meeting [6] - Fed officials expressed that inflation risks are easing, with expectations for prices to align with the central bank's target later this year [5] International Market Developments - The Euro Stoxx 50 Index decreased by -0.10% amid cautious sentiment ahead of U.S. economic data and bank earnings [13] - Japan's Nikkei 225 Index reached a new record high, driven by potential political changes and strong performances in healthcare, energy, and banking sectors [17][18] - China's trade surplus hit a record $1.19 trillion in 2025, with exports rising +5.5% year-over-year, indicating robust manufacturing strength [15]

Core Insights - Deposit account rates are declining, but competitive returns on certificates of deposit (CDs) can still be locked in, with the best CDs offering rates above 4% [1] Group 1: Current CD Rates - The best short-term CDs (six to 12 months) currently offer rates around 4% to 4.5% APY, with Marcus by Goldman Sachs offering the highest rate of 4% APY on its 1-year CD [2] - Historical trends show that average one-year CD rates were around 1% APY by 2009, following the financial crisis, with five-year CDs yielding less than 2% APY [2] - The trend of falling CD rates continued into the 2010s, with average rates on 6-month CDs dropping to about 0.1% APY by 2013 [3] Group 2: Economic Influences on CD Rates - The Federal Reserve's policies, particularly the decision to keep benchmark interest rates near zero, led to very low CD rates during the 2010s [3] - Between 2015 and 2018, the Fed's gradual rate increases resulted in a slight improvement in CD rates, marking the end of nearly a decade of ultra-low rates [4] - Following the COVID-19 pandemic, the Fed hiked rates 11 times between March 2022 and July 2023, leading to higher APYs on savings products, including CDs [5] Group 3: Future Projections and Trends - As of September 2024, the Fed began cutting the federal funds rate, resulting in a steady decline in CD rates from their peak, although they remain high by historical standards [6] - Traditionally, longer-term CDs offered higher interest rates, but currently, the highest average CD rate is for a 12-month term, indicating a flattening or inversion of the yield curve [7] Group 4: Choosing the Best CD - When selecting a CD, factors such as the term length, type of financial institution, account terms, and inflation considerations are crucial for maximizing returns [8] - Online banks often provide higher interest rates than traditional banks due to lower overhead costs, but it is essential to ensure they are FDIC-insured [8] - Understanding the terms of the CD, including maturity dates and withdrawal penalties, is vital for making informed investment decisions [8]

Economic Policy and Market Reactions - Trump announced a 25% tax on imports from countries doing business with Iran, coinciding with protests in Iran resulting in over 2,500 deaths [1] - U.S. companies face pressure to deliver strong profit growth, with analysts expecting S&P 500 companies to report an 8.3% increase in earnings per share for Q4 2025 compared to the previous year [2] - The U.S. stock market is set for a low opening, with Dow futures down 0.21%, S&P 500 e-mini futures down 0.16%, and Nasdaq 100 futures down 0.17% [11] Company Performance - JPMorgan Chase reported weaker profit and revenue than expected, leading to a 4.2% drop in its stock, significantly impacting the market [3] - Moderna's stock surged 17.1% after announcing expected revenue for 2025 above previous forecasts, along with updates on new products including a seasonal flu vaccine [7] Bond Market and Interest Rates - Treasury yields eased following an inflation update that met economists' expectations, reinforcing predictions of at least two interest rate cuts by the Federal Reserve in 2026 [8] - The 10-year Treasury yield decreased to 4.17% from 4.19%, while the two-year Treasury yield fell to 3.52% from 3.54% [10][12] Inflation and Consumer Prices - U.S. consumer prices rose 2.7% year-over-year, slightly above expectations and exceeding the Federal Reserve's 2% inflation target [9][12]

Core Viewpoint - Any loss of U.S. Federal Reserve independence would lead to increased inflation and could jeopardize financial stability, as stated by Finnish central bank Governor Olli Rehn, who expressed support for Fed Chair Jerome Powell [1] Group 1 - The independence of the U.S. Federal Reserve is crucial for maintaining low inflation levels [1] - A potential loss of this independence could have negative implications for financial stability [1] - Olli Rehn's comments reflect a broader concern among central bankers regarding the importance of central bank autonomy [1]