Market Trend & Strategy - The market suggests the Federal Reserve (Fed) will implement approximately 1 and 3/4 more rate cuts before the end of the year, making it difficult to bet against the Fed's actions [1] - The old investment playbook of aligning with the Fed's actions remains effective [2] - Small caps and financials are identified as key sectors to watch, with potential opportunities in home builders [3] - The Russell 2000 is potentially reaching its first all-time high close since November 8th, 2021, marking a significant consolidation period [3][4] - A possible chase for performance is setting up, with a pivot towards sectors that have underperformed relatively [9] Financial Sector Analysis - Financials are trading without multiple expansion, presenting an opportunity as the sector's PE multiple remains at January levels [6] - The financial sector benefits from investor engagement, increased M&A activity, and regulatory relief [12] - Major banks like Citigroup, Goldman Sachs, Morgan Stanley, Bank of America, and JP Morgan are at 52-week or record highs [13] - Rate cuts without a recession are expected to drive a continued rally in bank stocks, influencing price target increases [14] Investment Considerations & Risks - Some argue against investing in banks outside the top six, citing the private credit market's encroachment on commercial lending and its sensitivity to net interest margin [15] - The big three (JP Morgan, Goldman Sachs, and Morgan Stanley) are favored due to their revenue streams from deal premiums, M&A transactions, and wealth management, making them less sensitive to interest rate moves [15][16] - Fintech companies, like SoFi, are seen as having significant upside potential due to their banking-as-a-service technology, which is less interest rate sensitive [19][20]

Joining us with more on the markets, Gabriel Santos, JP Morgan, asset management, a chief market strategist for the Americas. And I'm you don't sound in in this uh in in looking at your notes in the midyear check, Gabrielle. You don't sound that bullish really is would you you kind of sound how you did it at the lows.You didn't say we weren't going to go back up, but you didn't really No one expected us to just bounce right back to where we are so quick to new highs so quickly in this because tariffs not th ...