I think this is noise over substance right now. I think the market, broadly speaking, continues to trade off fundamentally.

Alright, Marta. As expected, the Fed held rates steady today, but what does that mean for twenty twenty six? Could we still see two cuts?

Least looking at the data as it stands today, we are expecting rates to edge lower. That's because our base case is that earnings support the labor market and inflation edges down over the course of the year, But there are wild cards out there.

And what's the disconnect right now? Because inflation's easing but still above target.

We know consumer sentiment is weak and job confidence. It doesn't feel great either.

Okay. Stick with me on this one. Okay. In his presser, Fed Chair Powell suggested that there are some nascent signs of stabilization, and economic activity has clearly improved, and that should support the labor market, which was the big concern in the fall.

But that might not matter as much to consumer sentiment. There's this relativity factor in sentiment. The job market has weakened relative to the historically tight levels that we had. It's still stronger than the historical average, but it's weakened.

The rate of price increases has come down, but that sticker shock remains given the impact of inflation from prior years. And there are these inflation hotspots. Wage growth has been resilient, but consumers don't like seeing their necessities carry higher prices, heating bills, food, housing.

Yeah. That really helps explain why the data is saying one thing, but people are feeling another. There's also a political layer that we have to talk about, Marta. President Trump could name the next Fed chair very soon. How much does that actually matter?

I think this is noise over substance right now. I think the market, broadly speaking, continues to trade off fundamentals in the bond market. And we'll have a better sense of things once we know who that new chair is. But even then, there is a committee for a reason.

Meanwhile, four of the Magnificent Seven report today and tomorrow, and I'm gonna test you a little bit here, Marta, because several of them, probably reporting right now as this video is going into production.

Why could that matter? Those earnings numbers matter more than the Fed share.

Well, so far in twenty twenty six, the news flow and investors have focused on geopolitics. But with markets, earnings arguably matter more particularly as it pertains at this moment in time to AI. And we'll get our first look at how those AI earnings are trending with these reports. What's the bear case? Well, that even with good results, the companies can't get investors to shake their AI doubt.

So watch the guidance. Always. And on a numbers basis, capital expenditures I expect will continue to loom large, and I also expect revenue from cloud services to gain some attention.

Perfect. Fed on hold, inflation and jobs still the constraint right now, but the next big signal is MAG seven earnings, and we'll be watching.

Marta Norton, thank you so much.

Thanks, Vanessa.