Good Morning,
Happy Monday and I hope everyone had a great weekend!
Markets opened lower this morning ahead of a busy week of data and headlines. The US DOJ has served the Federal Reserve with grand jury subpoenas targeting Fed Chair Powell, threatening possible criminal charges linked to his June testimony regarding the Fed's $2.5bb renovation project. Chair Powell released a video Sunday evening where he publicly framed this move as a politically motivated escalation designed to pressure the Fed to lower rates, given his long-running feud with President Trump over monetary policy. I don’t think much will materialize here but it does feed negative sentiment near-term. In other headlines, President Trump has proposed a 10% cap on credit card interest rates. Financial stocks are lower this morning on the news but the measure will likely need congressional approval to become law. With midterms around the corner, I think we will continue to see headlines focused on helping the US consumer. Finally, the Supreme Court could rule on Tariffs as soon as Wednesday. In data news, Q4 earnings season kicks off this week with the big banks front and center. We also get December CPI on Tuesday and retail sales Wednesday. Like I said to start, a lot of data/headlines this week but sifting through it all, I think fundamentals remain unphased. The broadening out should continue which is why I am favoring higher cash flow companies that benefit from AI advancements as we head into the new year.
Attached, please find this week’s Market Strategy Radar Screen Report from John Stoltzfus, Chief Investment Strategist of Oppenheimer Asset Management.
Have a great week!
(Note – our offices and the markets will be closed, Monday the 19th in honor of MLK day.)