Well, major averages extended their gains from Friday with tech leading the gains. This comes as investors await another big week of earnings reports this week and two key pieces of economic data, including the January jobs and the consumer price index. Joining us now with a look at what will be the key drivers this week are Sam Soval.He is a chief investment strategist at CFR and Tim Seymour from Seymour Asset Management and of course a fast money trader. Good to see you both, gentlemen. Um Tim, I will sta ...

Summary of Key Points from the Conference Call Industry Overview - Global equities have reached all-time highs, with notable performances in various sectors: - US Momentum Long index up 15% YTD - Pre-Profit Tech stocks up 12% YTD - Meme stocks increased by 5% in the past week - CSI1000 index has risen for 7 consecutive sessions - KOSPI up 9% YTD after a 76% increase last year - Gold prices continue to rise, and credit spreads are narrowing [2][3] Core Insights and Arguments - Market sentiment is positive, with a strong appetite for risk [4] - Global funds have reduced their exposure, leading to the fastest net selling of equities in over 8 months, particularly in the US and China [4] - The outlook for 2026 remains optimistic, driven by different growth factors compared to 2025, including AI capital expenditures and dovish Federal Reserve expectations [6][7] - Portfolio diversification is emphasized as a key strategy, with tactical hedges recommended due to the current macro conditions being perceived as too comfortable [11][13] Regional Equity Insights - The report suggests a modest pro-risk stance with an overweight (OW) position in equities across various regions: - OW in MSCI Asia Pacific ex Japan, S&P 500, TOPIX, and select commodities [18] - Emerging markets (EM) are viewed as having better risk-reward profiles compared to the S&P 500 [21] - European equities are trading at a significant discount compared to US peers, indicating potential alpha themes to watch [29] - Asia is expected to maintain a similar trajectory, with regional EPS growth projected at 19% for this year and 12% for 2027 [32] Specific Country Insights - China, Korea, and India are recommended for overweight positions, while Japan is downgraded to market weight due to valuation concerns [33][41] - India's market is anticipated to recover after a significant underperformance last year, with foreign institutional investors showing renewed interest [43] - Valuation premiums for China have narrowed significantly, indicating a potential shift in investment dynamics [45] Additional Considerations - The upcoming earnings season is expected to show a 7% growth, which is considered a low bar to surpass, with a focus on the acceleration of growth in subsequent quarters [22] - Retail investor enthusiasm is rising, with margin balances hitting new highs, suggesting a longer "Spring Stir" window due to the later-than-usual Chinese New Year [39] - The report highlights the importance of continued momentum in China for the overall Asian market outlook [36][37]

Summary of Key Points from the Conference Call Industry Overview - The report focuses on the **US Equity Market**, specifically the **S&P 500** and its components, providing insights into earnings growth, valuation, and market dynamics for 2026 and beyond [2][3]. Core Insights and Arguments - **Earnings Growth as a Driver**: Earnings growth is identified as the primary driver of equity returns, with projections indicating a total return for the S&P 500 driven by earnings, valuation, and dividends [4][5]. - **S&P 500 Earnings Forecast**: The forecast for S&P 500 earnings per share is $272 for 2025 (+11%) and $305 for 2026 (+12%), with an expected index level of 7600 by the end of 2026 [10][11]. - **Concentration of Earnings Growth**: The seven largest stocks in the S&P 500 are projected to account for nearly 50% of the index's earnings per share growth [11][12]. - **Valuation Levels**: The aggregate S&P 500 index and median stock are trading at elevated valuations, with a forward P/E multiple of 22x for the S&P 500 and 19x for the median stock [15][19]. - **Speculative Trading Activity**: Speculative trading activity rose in 2025 but remains below historical extremes, indicating a cautious market environment [23][24]. - **IPO Activity**: IPO activity rebounded in 2025 but is still below average levels, with only 61 IPOs compared to a median of 101 post-2000 [27][28]. - **Market Peaks and Fed Tightening**: Historical data shows that past overextended equity markets have peaked amid Federal Reserve tightening, suggesting a potential risk for the current market [31][35]. Additional Important Insights - **GDP Growth Projections**: The macro outlook indicates above-consensus and accelerating US GDP growth in early 2026, with potential upside for middle-income consumer stocks [48][55]. - **Hyperscaler Capital Expenditure**: Analysts expect hyperscaler capital expenditures to total nearly $550 billion in 2026, with significant contributions from major tech companies [58][59]. - **Buyback Growth Stalling**: S&P 500 buyback growth has stalled over the last two quarters, indicating a shift in cash allocation priorities among companies [77][78]. - **Valuation Dispersion**: There is a wide valuation dispersion within sectors, particularly in the healthcare sector, which trades at a discount to its return on equity-implied price/book valuation [88][96]. Conclusion - The US equity market is poised for growth driven by earnings, but elevated valuations and concentration risks present challenges. The macroeconomic environment, including GDP growth and capital expenditures in technology, will play a crucial role in shaping market dynamics in 2026 and beyond [39][41].

Give me a final trade while I have you real quick, please. >> Oh boy. Okay, I'll give you Milrose Properties, which leads into Steph's housing plate.9% yield. Excellent company. >> Josh, final.>> Exon Mobile breaking out. >> Steph, >> I like the India ETF. INDA, >> Nvidia, Broadcom, all of them going higher.>> Okay, so I'll see at three. We got Adam Parker, Edard Denny, Cameron Dawson, Brent Talkington, Kevin Simpson's got some new moves, too. And we'll certainly game out 2026.I'll see you in a couple hours ...

Market Trends & Growth Opportunities - Wedbush believes investors are underestimating Microsoft and Azure growth, with use cases exploding [1] - The last month has seen 2,530% of deals accelerated [1] - Hyperscaler investors are giving it no respect [2] - Only 3% of US companies have gone down the AI path, indicating significant growth potential [3] - Tech stocks are expected to be up 2,025% in 2026 [4] - 2026 is expected to be the year of AI monetization [7] - The AI revolution is fueled by Nvidia, which is 4 to 5 years ahead of anyone else in the market [8][9] Valuation & Investment Strategy - Street numbers for Microsoft are underestimated by 15% to 20% for 2026 [4] - Nvidia at 25 times forward earnings is considered a bargain [8] - Sell-offs in Nvidia are seen as golden buying opportunities [10] - It is more of a stock pickers market, focusing on ultimate winners in software, semis, and infrastructure [11] AI & Technology - Demand for Nvidia chips is 12 to 1 compared to supply [3] - Palantir customers are seeing ROI way accelerated ahead of what they ever expected [6]

Summary of J.P. Morgan Global Equity Strategy Conference Call Industry and Company Overview - **Industry Focus**: Global Equities, particularly driven by the AI sector and its implications across various industries including Technology, Utilities, Banks, Health Care, and Logistics [2][20][23] - **Company**: J.P. Morgan Securities LLC, a leading investment bank providing insights on market strategies and equity outlooks [3][5] Core Insights and Arguments Global Equity Outlook - **Positive Sentiment**: Expectation of double-digit gains in global equities across Developed Markets (DM) and Emerging Markets (EM) due to robust earnings growth, lower interest rates, and declining policy headwinds [2][20] - **U.S. as Growth Engine**: The U.S. economy is anticipated to remain the world's growth engine, driven by an AI supercycle leading to record capital expenditures (capex) and rapid earnings expansion [2][20][23] - **AI Investment**: Corporates and governments are racing to invest in AI, motivated by productivity gains and the fear of obsolescence, creating a polarized K-shaped economy with distinct winners and losers [2][20][21] Earnings and Market Projections - **S&P 500 Price Target**: Projected price target of 7,500 by year-end 2026, with expected earnings growth of 13-15% for 2026 and 2027 [6][22][28] - **Earnings Growth**: Anticipated EPS of $315 for 2026 and $355 for 2027, surpassing consensus estimates [6][22][28] - **Market Concentration**: AI-related stocks are increasingly dominating the S&P 500, with the top 30 AI stocks accounting for 44% of the index's market cap [26][39] Regional Insights - **Eurozone**: Expected earnings growth of over 13% in 2026, supported by fiscal stimulus and improved credit conditions [6][20] - **Japan**: Anticipated benefits from corporate reforms and increased capital investment, with a focus on unlocking excess cash [6][20] - **Emerging Markets**: Positioned for robust performance due to lower interest rates, attractive valuations, and improvements in corporate governance [13][20] Important but Overlooked Content - **AI's Impact on Economy**: The AI sector is expected to exacerbate the K-shaped recovery, leading to increased market concentration and a "winner-takes-all" dynamic [20][26] - **Investor Sentiment**: Broad sentiment measures are likely to experience sharp swings, despite solid underlying trends and fundamentals [2][20] - **Sector Rotation**: A shift is expected from peripheral markets (Italy, Spain) to core markets (France) within the Eurozone, indicating potential investment opportunities [6][20] Sector and Style Recommendations - **Sector Preferences**: Favorable outlook on Technology, Utilities, and Defense sectors, while remaining cautious on Financials and Health Care [30][36] - **Style Views**: Continued dominance of Quality Growth and Momentum stocks, with sensitivity to monetary policy shifts [36][30] Conclusion - **Investment Strategy**: J.P. Morgan emphasizes a selective approach to investment, focusing on sectors and companies that are well-positioned to benefit from the ongoing AI supercycle and broader economic trends [20][30][36]

Investment Rating - The report indicates a positive outlook for the Chinese equity market, particularly aligned with the 15th Five-Year Plan (FYP) [3][40]. Core Insights - The 15th FYP emphasizes high-quality, secure, and balanced growth, with a focus on technology, innovation, and improving people's livelihoods as key priorities for 2026-2030 [1][12]. - Historical analysis shows that aligning investment strategies with the FYP can yield significant alpha, with a potential 13% annualized alpha if portfolios are aligned with policy trends [2][18]. - The report identifies a universe of 35 GICS3 Industries that are expected to benefit from policy support, representing a total market cap of US$13 trillion, which is 66% of the full universe [3][40]. Summary by Sections 1. Historical Performance and Policy Alignment - MSCI China and CSI300 have delivered 8-10% total return CAGR since the 10th FYP, trailing nominal GDP growth of 11% [2][18]. - The report highlights that specific sectors mentioned in the 14th FYP significantly outperformed the benchmark, with average returns of 41% compared to -3% for the CSI300 [24][25]. 2. 15th FYP Portfolio Construction - The report screens for 50 mid-cap stocks across 21 sub-sectors, which have returned 68% in the past year, outperforming MSCI China by 33 percentage points [4][54]. - These stocks are expected to deliver a 30% EPS CAGR over the next two years, compared to 15% for MSCI China, indicating strong growth potential [4][54]. 3. Key Themes and Investment Opportunities - The report identifies several investment themes, including the return of private-owned enterprises (POEs), Going Global, AI, Anti-Involution, and Shareholder Returns, which are expected to outperform in a slower market [3][40]. - Emerging technologies such as 6G, bio-manufacturing, and hydrogen/nuclear fusion are highlighted as new areas of focus in the 15th FYP [12][15]. 4. Sectoral Analysis - The selected industries predominantly reside in Technology, Consumer, and Materials sectors, with a strong emphasis on tech-related industries expected to receive policy support [40][41]. - The report notes that the 15th FYP universe is expected to grow faster than the broader market, with higher profitability and growth capex intensity [40][39].

Core Viewpoint - The market is expected to shift focus towards earnings growth in 2026, particularly in the small and midcap sectors, which are projected to experience a recovery from previous earnings recessions [2][3][5]. Small and Midcap Sector - Small and midcap companies are anticipated to see earnings growth improve from low single-digit this year to low double-digit next year, driven by a recovery from two years of declining earnings [3][5]. - Companies in the small and midcap space that have raised their Q4 and 2026 guidance during the Q3 reporting period have outperformed the S&P 500 [3]. - The economic sensitivity of small and midcap stocks is expected to provide a favorable setup as macroeconomic conditions stabilize and potential Fed rate cuts occur [6]. AI Sector Dynamics - The AI sector is characterized by persistent spending dynamics, with capital expenditure improvements expected through the end of the decade [7][8]. - Ongoing volatility is anticipated as companies navigate the pace and justification of their AI-related spending [8]. - There is a focus on stock selection within the AI space, with an emphasis on semiconductors and software, while communication services have been adjusted to a market weight [10]. Broader Market Implications - Companies not directly associated with AI are beginning to implement AI processes, which could lead to higher productivity, improved margins, and reduced earnings volatility in the long term [11].

Market Sentiment - There is cautious optimism in the markets despite recent volatility, with a notable battle between consumer spending and sentiment [2][4] - Strong equity markets are being driven by reasonable earnings and good job numbers, indicating a shift from caution to more aggressive market behavior [3][5] Economic Indicators - Concerns exist regarding consumer spending during the holiday season, which is critical as it constitutes roughly two-thirds of GDP [4] - The S&P 500 has recovered from previous losses, indicating a psychological wobble rather than a fundamental market issue [5][6] Sector Performance - The market is currently influenced by a K-shaped economy, where asset price levels and corporate prosperity are sustaining market performance [5] - Technology, particularly driven by AI, is a significant factor in market dynamics, with companies continuing to invest in this sector [7][8]

Investment Rating - The report does not explicitly provide an overall investment rating for the sectors discussed [2]. Core Insights - The technology sector experienced a positive month with the NDX closing near all-time highs, driven by AI-related themes and significant partnerships [3]. - Financials faced bearish narratives, particularly concerning regional bank credit and consumer credit, impacting investor sentiment [3]. - The healthcare sector saw improved sentiment due to drug pricing agreements and increased M&A activity, although some biopharma stocks reverted initial gains [3]. - Consumer sentiment has turned cautious, particularly in restaurants and grocery sectors, indicating potential slowdowns [3]. - Industrial stocks showed mixed performance, with data centers and AI-related companies gaining traction while materials underperformed [3]. - Energy sector discussions centered around negative oil views, with potential for volatility and price upside due to geopolitical factors [3]. - Utilities are focusing on EPS guidance updates, particularly related to data centers and power demand growth [3]. - Special situations saw increased M&A activity, with notable deals and strategic sponsor involvement [3]. Sector Summaries Technology - The sector saw a +5% increase in October, with AI themes driving performance [3]. - Key subsectors included Semiconductors (+11%) and Software, which remained flat [3]. Financials - The sector faced challenges with narratives around credit quality and consumer spending [3]. - Notable upcoming earnings reports from private credit firms are expected to provide insights [3]. Healthcare - The sector experienced a boost from drug pricing agreements and M&A activity, although some stocks faced volatility [3]. - Biotech sentiment improved following significant policy changes [8]. Consumer - Sentiment has shifted to a more guarded stance, particularly in restaurants and grocery sectors, indicating potential slowdowns [10]. - Upcoming earnings from major retailers will be critical to assess the impact of economic conditions [10]. Industrials - The sector showed modest gains, with data centers and AI-related stocks performing well [3]. - Concerns about inflation and earnings downgrades were noted in the materials subsector [3]. Energy - Investor sentiment remains cautious, with discussions around oil price volatility and geopolitical developments [3]. - The refining sector is experiencing mixed conversations regarding future expectations [3]. Utilities - Focus on EPS guidance updates and potential growth in power demand [3]. - M&A activity is expected to increase, with significant deals in the pipeline [3]. Special Situations - M&A activity surged in October, with notable deals and strategic sponsor involvement [3]. - The report highlights ongoing debates around valuations and potential acquisition targets [19].