Macro

JPMorgan CEO Jamie Dimon highlighted recent auto sector bankruptcies, including Tricolor Holdings and First Brands, as early warnings of loose corporate lending standards post-2010. JPMorgan took $170 million in charge-offs from its Tricolor exposure, while other banks like Fifth Third and Jefferies face hundreds of millions in losses, sparking broader concerns about hidden credit risks in leveraged lending markets.

Consumer sector sentiment is bearish this month, pressured by growing concerns over corporate lending risks highlighted in the wake of auto firm bankruptcies. While broader corporate excess is the focus, the direct link to auto firms—key drivers of consumer credit and spending—casts a shadow over near-term consumer resilience.

China imposed new export curbs on rare-earth materials including samarium, gadolinium, and lutetium in its 2026 licensing catalogue. The April enforcement framework penalizes over-quota production, with extraterritorial rules taking effect in November 2026. Near-zero shipments of terbium and dysprosium to Japan are disrupting supply chains for tech, auto, aerospace, and clean-energy sectors.

The raw materials sector is sharply higher this month, driven by gold's breakout above $4,000 per ounce on persistent currency debasement concerns, which has lifted investor demand for tangible stores of value. While China's new rare-earth export controls ahead of U.S. talks have added underlying tension, the move is narrowly focused and has not broadly amplified gains across the sector. The overall read remains very bullish, anchored by gold's momentum rather than broad-based supply disruptions.

Trump's tariff escalation raised construction and material costs and kept inflation and rates elevated, leaving housing sluggish and office CRE still distressed though bottoming in some markets; a grinding, modestly negative year for owners.

A hostile policy year: RFK Jr. as HHS Secretary rattled vaccine makers and FDA credibility, Trump's most-favored-nation order threatened to slash US drug prices to foreign levels, tariff threats loomed, and UnitedHealth crashed on a DOJ probe and guidance cuts. Broad…

A turbulent year, Trump's tariff escalation (the April 'Liberation Day' crash), threats to Fed independence (firing attempts at Cook and the BLS chief), and a crypto plunge from its peak whipsawed markets, while LA wildfires slammed insurers.

Trump's tariff escalation was double-edged — protecting domestic producers but shocking supply chains and inviting retaliation (April 'Liberation Day' plunge) — yet accelerating reshoring and a roaring data-center power/electrical-equipment cycle drove strong order books…

Meta and Alphabet AI-ad strength kept owners positive, interrupted by the January DeepSeek shock and April's Trump tariff selloff that raised hardware-cost and recession fears. Positive with a spring dip.

Oil producers were squeezed as OPEC+ raised output into tariff-driven demand fears and prices tanked, but power generators, nuclear, and gas-for-electricity boomed on record capacity prices and relentless AI data-center demand; a brief June war spike round-tripped…

China has expanded export restrictions on rare earths and related technologies, requiring licenses for foreign entities using Chinese-sourced materials or IP, with exemptions for military-linked entities. The move strengthens Beijing's geopolitical leverage in critical supply chains, potentially impacting global high-tech and defense sectors. The timing suggests strategic positioning ahead of possible U.S.-China trade talks, aiming to pressure Washington for concessions.

Defense sector sentiment is sharply positive this month, driven by heightened strategic tensions as China tightens rare earth export controls—a critical input for advanced weapons systems—amplifying concerns over supply chain resilience. The move underscores the growing emphasis on domestic defense industrial base security, particularly ahead of potential high-stakes U.S.-China talks, which markets interpret as reinforcing long-term defense spending momentum. Geopolitical friction, rather than de-escalation, appears to be pricing in sustained demand for defense capabilities.

The late-January DeepSeek shock briefly crashed our AI-power trade on fears demand was overstated, but the data-center buildout and nuclear and gas-turbine supercycle reasserted themselves, keeping owner sentiment strong through tariff-driven volatility.

Nvidia became the first publicly traded company to reach a $5 trillion valuation, fueled by strong demand for its AI-powered GPUs and strategic partnerships with firms like OpenAI and Palantir. The milestone highlights AI's transformative impact on tech markets, though concerns about an AI-driven bubble have emerged among financial regulators and analysts. Unlike the dotcom era, today's tech leaders boast solid cash flows, suggesting sustained momentum.

The tech sector is sharply positive this month, led by Nvidia's surge to a $5 trillion market cap on the strength of sustained AI-driven demand. This outperformance reflects broad confidence in continued growth in AI infrastructure spending, with Nvidia's valuation acting as a sector-wide sentiment amplifier.