The ECB should reduce borrowing costs to help the economy by weakening the single currency, Italian Deputy Premier Antonio Tajani says https://t.co/w8pQiyS4dh ...

Nigeria’s annual inflation rate fell for a third straight month in June, bolstering the case for policymakers to again keep borrowing costs unchanged as they wait to see if the trend holds https://t.co/cwGNsZi6z6 ...

The Trump administration is demanding the Federal Reserve slash interest rates. Ironically, that would likely cause your borrowing costs to rise, says @erietedeschi (via @opinion) https://t.co/xZhAd8Tb3j ...

Representative Yassamin Ansari told attendees that Democrats should focus on rising costs of energy associated with Trump's new law if they want to win back power https://t.co/BMWZBPkTiL ...

Surging construction costs and booming demand for flights are fueling a rush of debt sales from US airports https://t.co/ppT7d3srlV ...

Investment Rating - The report upgrades the S&P 500 valuation and return forecasts, expecting a rise of 10% to 6900 over the next 12 months, with a forward P/E multiple of 22x [3][4]. Core Insights - The S&P 500 forward P/E of 22x ranks in the 97th percentile since 1980, but is deemed appropriate given the current macroeconomic conditions, including declining interest rates and elevated corporate profitability [3][11][12]. - Earnings growth is projected at 7% for both 2025 and 2026, with EPS estimates of $262 and $280 respectively, although there are two-way risks around these forecasts [6][24]. - The report highlights narrow market breadth, with the median S&P 500 constituent 11% below its high, indicating potential for a momentum reversal in the equity market [30][34]. - Sector allocation recommendations include a mix of secular growth (Software & Services, Media & Entertainment), cyclical (Materials), and defensive (Utilities, Real Estate) industries, with a focus on AI-related technology stocks [41][44]. Summary by Sections Valuation and Earnings Forecasts - The S&P 500 is expected to reach 6900 in 12 months, with return forecasts of +2%, +5%, and +10% over 3, 6, and 12 months respectively [4][47]. - The forward P/E multiple has been increased to 22x, with EPS growth of 7% anticipated for 2025 and 2026 [6][49]. Market Conditions - Current macroeconomic conditions support the elevated P/E multiple, with expectations of earlier Fed easing and lower bond yields [12][16]. - The report notes that investor positioning is neutral, suggesting that current market multiples do not reflect investor exuberance [17][20]. Sector Preferences - There is no clear consensus on sector preferences among clients, but AI-related technology stocks are generally favored despite valuation concerns [41][44]. - The recommendation to invest in Alternative Asset Managers within the Financials sector has been positively received [41]. Market Breadth and Momentum - The S&P 500's recent record high contrasts with the median constituent being significantly below its peak, indicating narrow market breadth [30][34]. - A potential momentum rotation is anticipated, although it is expected to be short-lived rather than indicative of a new long-term trend [40].

Core Viewpoint - Ford Motor Company has faced challenges related to recalls and warranty costs, which have impacted its financials, despite claims of quality improvements [1][2]. Group 1: J.D. Power Initial Quality Study (IQS) - The J.D. Power IQS, now in its 39th year, surveys over 90,000 customers of new vehicle models after 90 days of ownership to assess problems per 100 vehicles [3]. - Lexus ranked highest overall in the 2025 study with a score of 166 problems per 100 vehicles (PP100), followed by Jaguar and Genesis [4]. - For mass-market brands, Nissan led with a score of 169 PP100, while Hyundai and Chevrolet followed with scores of 173 PP100 and 178 PP100, respectively [5]. Group 2: Ford's Performance in IQS - Ford scored 193 PP100 in 2025, which is below the industry average and worse than its previous scores of 178 PP100 in 2024 and 174 PP100 in 2020 [8][9]. - The decline in Ford's score raises questions about the improvement in vehicle quality and potential rising warranty costs [9]. - The automotive industry has seen increased complexity in vehicles, which may contribute to initial problems as new technologies are introduced [9]. Group 3: Implications of IQS Scores - The J.D. Power study focuses on initial problems within the first 90 days, which are not likely to correlate with recalls or significant warranty costs [12]. - Issues identified, such as infotainment problems and cupholder sizes, are not expected to impact Ford's earnings significantly [11][12]. - The study serves as a valuable resource for consumer feedback, but it may not accurately reflect long-term vehicle quality improvements [13]. Group 4: Conclusion on Ford's Quality - Despite the declining scores, there are no immediate red flags regarding potential recalls or earnings impacts for Ford [14]. - The company’s recent quality initiatives may take time to manifest in improved scores as newer models replace older ones [13].

Key Takeaways DAL posted better-than-expected Q2 earnings and revenues, though earnings fell year over year. Labor costs jumped 10% in Q2 due to higher wages from a 2023 pilot contract. A 13% drop in fuel expenses helped offset rising costs, aided by falling oil prices in the June quarter.Delta Air Lines (DAL) reported better-than-expected earnings per share and revenues in the second quarter of 2025, results of which were unveiled yesterday. However, the bottom line declined substantially year over year ...

Russia’s coal industry has slipped into crisis under the weight of high borrowing costs and sanctions https://t.co/S4GY2arqOR ...

Germany’s long-term borrowing costs are on course to close at their highest since 2011 as investors demand a growing premium to fund the government’s large-scale spending commitments https://t.co/6foRYd7mGa ...