Joining us uh for more on the markets, Tom Hanland, national investment strategist at US Bank Asset Management. Uh good morning to you, sir. I'm curious, >> uh I'm curious as we think about just the last few trading days of the year and going into next year.Uh we're doing so at fairly lofty valuations. The market's seen decent appreciation this year. Is that a concern of yours uh as you think about your portfolio heading into the new year.You know, Leslie, I think what was confidence building was that the m ...

All right, let's talk about the change in retail investor sentiment when it comes to the Mag 7. So, right now they're driving about a third of the action, a third of the volume when it comes to the Mag 7, but you say that's down quite a bit from the levels that we were at last year and the year before. What does that say about the thoughts that this is a bubble. What does that say about retail investor confidence in the AI trade.>> Well, we're we're still only like, you know, one 2% off all-time highs. So, ...

Market Outlook & Economic Trends - Market reflects anticipation of a negotiated resolution to the government shutdown in the coming weeks [3] - Weak economic data suggests the Federal Reserve will likely implement a rate cut in December [3] - Cyclical sectors of the S&P 500 have experienced a significant collapse in relative price, nearing 35-year lows, indicating weakening economic conditions since the government shutdown [5] - Material stocks have plummeted since the shutdown, correlating with CPI inflation [6] - The economy is expected to slow, leading to broad easing from both monetary and fiscal authorities [9] Investment Strategy & Market Performance - Lower rates on short rates, lower bond yields, and a weaker dollar have been observed this year, alongside faster money growth [9] - High beta stocks, small-cap and micro-cap stocks, and international stocks are showing better results, reflecting policy changes [10] - Leadership is expected to emerge in high beta, small-cap, micro-cap, and international stocks [11] Economic Indicators & Concerns - ADP numbers are flat over the last 3 months [2] - Challenger layoffs have surged recently [3] - Consumer confidence is declining significantly [3]

Market Impact of Tariffs - Markets do not fully believe tariffs will be implemented on August 1st, otherwise markets would be significantly lower [1] - Pushing the tariff deadline suggests room for negotiation, but the 10% baseline tariff remains a floor [2] - The threat of tariffs has led some investors to seek opportunities in Europe [3] - Tariffs have weakened the dollar, benefiting international stocks for US investors [5] - US tariffs may catalyze fiscal impulse in Europe, China, and Japan, potentially boosting international diversification in the long term [6] Market Momentum and Strategy - Momentum begets momentum; new all-time highs can lead to further gains [7] - Investors should lean into the market momentum rather than taking profits despite trade anxieties and stretched valuations [8] - The spread thrust off the lows is a bullish indicator [8] Financial Sector Preference - The speaker favors big banks (KBE) over regional banks (KRE) due to regulatory tailwinds and M&A/IPO activity [9][10] - Big banks are expected to overcome sentiment hurdles during the upcoming earnings season [11] - Banks are preferred over insurance due to their cyclical nature and potential for higher profits and growth [12][13] Cyclical Sectors and Investment Strategy - The speaker favors cyclical sectors but prefers high-quality, large-cap companies [14] - While industrials and small caps are cyclical, there's hesitation on small caps due to rate headwinds and idiosyncratic challenges [14]

Geopolitical & Market Confidence - Investors appear to be largely shrugging off geopolitical tensions, with a baseline assumption that conflicts will not escalate significantly [1][2] - Despite potential ceasefire breaks, futures are higher, suggesting investor confidence in the situation remaining stable [1] Equity Strategy - The firm is modestly overweight equities, seeing opportunities more broadly across the asset class [3] - A neutral geographic allocation within equities is favored, indicating no strong conviction in a particular region or country [4][5] US Market Focus - With the Federal Reserve potentially easing and geopolitical tensions lessening, the US market remains a key area of focus [6] - Cyclical sectors like financials or industrials are attractive investment areas, potentially leading the market [7] US Small Cap Opportunities - US small caps are being considered, especially if sustained US economic growth holds up despite tariffs [8][9] - Small caps offer diversified access to US growth, excluding the mega-cap tech exposure prevalent in the S&P 500 [13][14] - Russell 2000 futures are up over 1%, outperforming NASDAQ [11]