Sentiment stabilizing, but selective: Markets have moved off panic and into cautious stabilization. There is no broad “everything rally” — leadership remains narrow and investors are rewarding real earnings durability over narrative.
Earnings back in the driver’s seat: Results have been generally solid, with markets favoring companies showing strong margins, clear guidance, and consistent cash flow. Quality and fundamentals are increasingly dictating price action.
Rotation beneath the surface: Capital continues to rotate toward financials, dividend payers, and value/cash-flow generators, signaling a shift away from purely speculative growth.
Macro still a constraint: Growth remains resilient, but sticky PCE inflation (~2.8%) limits the Fed’s flexibility. Rates are likely on hold near term, keeping markets sensitive to incoming data.
Headline risk still present: Greenland/tariff rhetoric, Fed independence uncertainty, and geopolitical developments remain background risks — but they are no longer dominating market structure.