Core Viewpoint - The threat of a mandatory 10% cap on credit card rates, as proposed by President Trump, is viewed as political noise unlikely to become law, according to strategist Ed Yardeni [1][2]. Banking Sector Analysis - Major bank stocks, including JPMorgan Chase & Co. and Capital One Financial Corp., experienced a notable decline following Trump's ultimatum regarding credit card rates [2]. - Yardeni characterized the ultimatum as a "trial balloon" from the administration, suggesting that it is intended to gauge public reaction rather than a serious legislative proposal [2][3]. - He predicts that powerful banking lobbyists will prevent any congressional legislation enforcing such a cap from passing [2]. Market Performance and Outlook - Despite political interference creating a "rocky path" for investors, Yardeni maintains an optimistic year-end target of 7,700 for the S&P 500, indicating a potential 10% upside from current levels [4][5]. - The current market is described as "earnings-led," supported by a resilient economy that has managed various shocks since 2020, with expectations of strong corporate profits in the upcoming quarter [5]. Bond Market Insights - Yardeni cautioned against further Federal Reserve rate cuts, arguing that the bond market does not indicate a need for them due to economic strength [6]. - He noted that "bond vigilantes" have already increased yields despite previous Fed easing, warning that unnecessary rate cuts could lead to an unsustainable stock market "melt-up" [6]. Stock Indices Performance - Year-to-date, the S&P 500 and Dow Jones indices have gained 1.44% and 3.09%, respectively, while the Nasdaq 100 index has risen by 1.03% [7]. - The SPDR S&P 500 ETF Trust and Invesco QQQ Trust ETF closed higher on Monday, with SPY up 0.16% at $695.16 and QQQ advancing 0.083% to $627.17 [7].