Markets are positioned for a soft landing, but strategists warn pent-up demand and renewed fiscal spending could push growth—and inflation—higher than expected. ...

U.S. financial markets are observing a full closure today, Thursday, December 25, 2025, in celebration of the Christmas holiday. Trading on both the New York Stock Exchange (NYSE) and Nasdaq is suspended for the entire day, with normal operations set to resume on Friday, December 26, 2025. This pause follows a shortened, yet record-setting, trading session on Christmas Eve, Wednesday, December 24, where major indexes continued their upward trajectory, fueling hopes of a "Santa Claus rally" to close out the ...

Scott Croniner joins us from uh city. He's US equity strategist. Scott, not to ask how much you can deadlift, but feel free to offer, you know, [laughter] >> let's just say, Kelly, I can lift my weight, but that's about it.>> Which is looking like a little less than that. All right. So, you do think a more dovish Fed is is a plank of this bull market story.>> Yeah, it's it's kind of interesting. We just published a note that hit a few minutes ago that I I titled uh the data is dead, long live the data. And ...

The monthly Global Fund Manager Survey from Bank of America has been widely followed for years on Wall Street for its ability to suggest sentiment extremes that often precede sizable market reversals. Indeed, the latest report released Tuesday shows professional investor sentiment is running at its hottest level in years. Among the key data points are fund managers' cash levels — they've dropped to just 3.3%, the lowest in the history of the survey, a clear signal that professional investors are leaning h ...

A rotation trade on Wall Street picked up pace this week. - MarketWatch photo illustration/iStockphoto After a brief reprieve, stocks linked to artificial-intelligence trade hit the skids this week, as investors once again shifted their money into anything with a whiff of value. Tired of paying up for trendy AI stocks trading at lofty valuations relative to their expected earnings, investors went bargain hunting after the Federal Reserve delivered another interest-rate cut on Wednesday. The move convince ...

All right. I think all day long we're going to talk about whether this was a hawkish cut. Was it a neutral cut. Was it a dovish cut.What was your take. I I felt like Jac Powell's comments about the the path forward not really being clear. That was a bit hawkish, but at the same time, the bond buying on the short end that seems a bit doubbish.Seems like it has almost the same effect as a rate cut. How did you view it. >> Well, our economists think that it was of course uh less less hawkish than the market ha ...

Federal Reserve Actions - The Federal Reserve cut the fed funds target range by 25 basis points to 3.50%–3.75% in a 9–3 vote, marking the first dissent in six years [1] - Chairman Jerome Powell indicated that this rate cut does not signal the start of a full easing cycle, as the Fed is now in "wait" mode [2] - The updated Dot Plot suggests only one additional quarter-point cut in 2026, with some officials predicting no cuts or even a potential increase next year, highlighting divisions within the committee [3] Economic Outlook - Powell expressed optimism about the economy, projecting growth above trend and a gradual decrease in inflation, with unemployment expected to peak at 4.5% before declining [4] - He noted that inflation could have been in the low-2% range without tariffs, and anticipates a significant easing of inflation in the second half of 2026 [5] Market Reactions - Following the Fed's decision, all three major indexes rose, with the Russell 2000 gaining approximately 1.3%, indicating a positive market response to the rate cut [6] - The 10-year Treasury yield spiked to a three-month high earlier in the week due to comments from Kevin Hassett, a potential Fed Chair replacement, who advocated for data-dependent decision-making rather than a predetermined rate path [7][9] Treasury Yield Dynamics - The 10-year Treasury yield is crucial as it influences borrowing costs across the economy, affects stock valuations, and can lead to a rotation of funds from equities to bonds [10][13] - Powell suggested that the rising yield could reflect expectations of higher economic growth, partly driven by increased productivity from AI [20] AI Economic Impact - A study from OpenAI revealed that AI tools are saving workers 40 to 60 minutes daily, potentially translating to $1.6 trillion in economic cost savings, which is about 6% of U.S. GDP [22][24] - If productivity gains from AI increase to two or three hours saved per day, the economic value could exceed $10 trillion [27] Investment Opportunities - The Power Portfolio, created by investment experts, aims to identify companies that will benefit from the ongoing economic realignment driven by AI and other technological advancements [28][31] - The focus is on smaller, overlooked U.S. companies that are positioned to capitalize on the significant capital flows into AI infrastructure and advanced manufacturing [30][31]

Core Insights - The company faced significant challenges over the past year, prompting a reassessment of its strategies and operations [1] - The CEO reflected on the initial expectations versus the actual outcomes, indicating a need for strategic adjustments [1] Financial Strategy - The company aimed for a soft landing by balancing EBITDA protection while gradually paying down debt and maintaining dividends [2] - Key focus areas included managing inventory levels in the channel, addressing the Rynaxypyr strategy, and reshaping leadership in India [2]

Summary of J.P. Morgan's 2026 Year-Ahead Outlook Industry Overview - The report discusses the macroeconomic environment and market dynamics as they relate to various asset classes, particularly focusing on the U.S. Treasury yield curve, equities, and commodities [5][7][33]. Key Points and Arguments Market Dynamics - Markets are expected to face a multi-modal macro risk distribution, with a base-case scenario suggesting a shift from a central mode to a right-side distribution indicating improving growth expectations but with increased overheating risks [5][7]. - The left-side tail risk, representing recession, is acknowledged but considered less likely compared to the overheating scenario [5][7][26]. Treasury Yields - Front-end Treasury yields are anticipated to remain in a bullish range, while the belly and long end of the curve may face bearish pressure due to risk-on trends and widening inflation breakevens [5][33]. - The 2-year note is highlighted as a key indicator for market expectations, currently positioned near critical levels around 3.50% [8][12][35]. Equities - Large-cap U.S. stocks are expected to lead a bullish trend into the first half of 2026, with higher volatility and potential drawdowns anticipated [5][13]. - Chinese equity indexes, such as the CSI 300 and Hang Seng, are noted for their bullish patterns, suggesting potential for reaching 2021 cycle highs [15][17]. Commodities - Base metals are expected to catch up to the strong performance of precious metals, with a longer-term bullish trend anticipated [5][21]. - Crude oil prices are expected to remain range-bound, contrasting with the bullish outlook for base metals [5][21]. Currency Outlook - A stronger U.S. dollar is anticipated in early 2026, with the potential for simultaneous strength in the AUD/USD pair, which is historically an outlier [5][16]. Inflation and TIPS Breakevens - The report suggests that bullish trends in base metals could lead to upward pressure on 10-year TIPS breakevens, which are expected to widen towards the 240-250 basis points range [20][66]. - A gradual rally in front-end yields is expected, with TIPS breakevens potentially widening if inflation pressures increase [20][66]. Risk Scenarios - The report outlines a left-side tail risk scenario where recession could lead to predictable market trends, but this is viewed as a lower probability outcome [26][68]. - A more aggressive bullish scenario for the 2-year note could indicate a recession outcome, leading to a significant break in consumption and labor data [26][40]. Other Important Content - The report emphasizes the importance of monitoring key levels, trends, and patterns in various markets to react to potential regime changes [7][12]. - The technical setup for the 2-year note suggests a potential target near 1.75% if bearish scenarios materialize [40][46]. - The report also discusses the potential for a steepening of the yield curve, particularly in the 2s/5s and 2s/10s curves, as markets navigate through 2026 [54][60]. This comprehensive analysis provides insights into the expected market conditions and investment strategies for 2026, highlighting both opportunities and risks across various asset classes.

Investment Rating - The report indicates a bullish sentiment among investors, with a net 34% overweight in global stocks, the highest since February 2025 [3][132]. Core Insights - Investors are optimistic about a soft landing for the economy, with 53% expecting this outcome, while global growth expectations have turned positive for the first time since December 2024 [2][19][23]. - The most crowded trade is "long Magnificent 7," with 54% of investors participating, while the AI bubble is seen as the biggest tail risk by 45% of respondents [3][28][31]. - The report highlights a significant shift in asset allocation, with increased exposure to emerging markets, healthcare, and commodities, while UK stocks and consumer discretionary sectors saw the largest declines in allocation [4][51][56]. Summary by Sections Macro Insights - 53% of investors expect a soft landing, 37% foresee no landing, and only 6% predict a hard landing [17][19]. - Global growth expectations have turned positive, with a net 3% of investors anticipating stronger economic conditions [23][105]. Asset Allocation - The report shows a net 17% overweight in commodities, the highest allocation since September 2022 [51][143]. - There has been a record decline in allocation to consumer discretionary stocks, now at a net 23% underweight [56]. Investor Sentiment - The average cash level among investors dropped to 3.7%, indicating a "sell signal" as historically low cash levels have preceded declines in stock prices [14][16]. - The Bull & Bear Indicator remains neutral at 6.3, suggesting a cautious approach among investors [99]. Future Expectations - 37% of investors expect MSCI Emerging Markets to outperform in 2026, while 30% anticipate the Japanese yen to be the best-performing currency [68][71]. - The most bullish catalyst for 2026 is widespread AI productivity gains, as indicated by 43% of respondents [72][75].