Momentum
Our momentum barometer remains in neutral territory.
Q&As
How did the 4Q 2025 earnings season begin?
Twelve of the 14 S&P 500 companies that reported showed EPS growth and exceeded estimates, which was generally positive for earnings season.
🟢 Goldman Sachs (GS) — EPS $8.25 vs $7.50
🟢 JPMorgan Chase (JPM) — EPS $4.31 vs $4.17
🟢 Bank of America (BAC) — EPS $0.98 vs $0.90
🟡 Wells Fargo (WFC) — EPS $1.28 vs $1.25
🔴 Citigroup (C) — EPS $1.19 vs $1.65
🟢 Taiwan Semicond. Man. Comp (TSM) — EPS $3.14 vs $2.90
🟢 ASML (ASML) — EPS $6.41 vs $6.27
🟢 Microsoft (MSFT) — EPS $4.13 vs $3.65
🟢 Netflix (NFLX) — EPS $0.58 vs $0.56
Corporate results are key. Why? Because if they begin to show weakness, it would be a clear sign that the economy is entering the late-cycle phase of our model. As long as profits continue to exceed expectations, the current economic cycle remains: expansion.
What could be the next US targets in 2026?
In Latin America, the focus would be on Mexico (migration, drug trafficking, and supply chains), Colombia (security and geopolitical alignment), and Cuba for ideological reasons, while Brazil would be more of a site of political influence than direct confrontation. In the North Atlantic, Greenland would remain strategic for its minerals and control of the Arctic. The US has wanted to acquire it for 150 years, but Denmark has refused. Rumors suggest the US could pay $70 billion to buy it. In the Middle East, Iran would continue to be the primary target through sanctions and deterrence. In Asia, China would remain the structural target through trade and technological pressure, with Taiwan posing the main systemic risk. In Europe, the target would not be a single country, but rather the EU and NATO, through trade, energy, and security pressure.
Why is France debating leaving NATO?
In France, there is an ongoing debate about NATO due to the perceived loss of sovereignty, as it is seen as an alliance dominated by the United States that limits European military autonomy and drags the country into conflicts unrelated to its interests. The war in Ukraine has reinforced dependence on Washington and the risk of escalation with Russia, rekindling the idea of an independent European defense. Furthermore, the historical precedent of France’s withdrawal from military command in 1966 makes a partial or total withdrawal politically conceivable, even if it is not official policy today.
Did Trump start a new imperialism?
It is not true that imperialism began with Trump, but it is clear that it has accelerated under his leadership. For decades, the United States has been appropriating the most profitable and strategic businesses in the global system, using its financial, regulatory, and geopolitical power to redefine the rules of the game. In recent years, the most significant moves have been the following:
1) Banking Secrecy and Offshore Banking (Switzerland) (Obama)
The US promoted the Common Reporting Standard (CRS) as a global system for the automatic exchange of banking information, forcing banks worldwide to share tax data between countries. However, the United States was excluded from this standard and instead imposed FATCA, a one-way regime that compels foreign banks to report information to the US, without full reciprocity. The result was the dismantling of Swiss and European banking secrecy, while the US consolidated its position as a net recipient of offshore capital.
2) Tax Havens and Tax Competition (Trump → Biden)
The US led the introduction of a global minimum tax on multinationals, forcing the rest of the world to raise their taxes and eliminating the competitive advantage of jurisdictions like Ireland, the Netherlands, and Switzerland. However, the US did not fully harmonize its own system, preserving exceptions and internal flexibility. In practice, this reduced external tax competition while maintaining domestic advantages, encouraging the relocation of capital and corporate headquarters to the US. Europe supported this move to take business away from Ireland.
3) Critical Technology and Intellectual Property (Trump → Biden)
Through tariffs, technology bans, and export controls, the US slowed China’s technological rise and limited European and Asian industrial powers, concentrating revenues in software, standards, design, and artificial intelligence.
4) Subsidized Reindustrialization (Biden)
With the CHIPS Act and the Inflation Reduction Act, the U.S. not only attracted industrial investment from Europe and Asia but also became directly involved as an economic partner in the sector. Through subsidies, guarantees, and government support, the U.S. government became an indirect shareholder and strategic partner in key companies such as Intel, Micron, and GlobalFoundries, assuming some of the financial risk to rebuild leadership in semiconductors. The goal was not only to manufacture more chips but also to control production capacity, know-how, and technological security within its borders.
5) Security and defense as a service (Biden)
The war in Ukraine consolidated the US as the dominant provider of weaponry, intelligence and logistics, displacing Europe and Russia as alternatives and creating a structural strategic dependence.
6) Energy from Europe (gas and LNG) (Biden)
After the Russian gas cutoff, the US became Europe’s main energy supplier via LNG, appropriating a strategic business that had belonged to Russia for decades and closing the cycle of European energy dependence.
Where is Venezuela headed?
Bonds have historically been the best predictors of the markets.
Whether the market believes the situation in Venezuela will improve or not is directly reflected in the price of its sovereign bonds.
Currently, Venezuelan bonds are trading near their all-time highs, hovering around 40 in the case of the Venezuela 11.95% 2031 bond, suggesting that the market is beginning to price in a more constructive scenario for the country. Volume reinforces this signal: when volume increases (visible in the bars at the end of the chart), it indicates that the price movement (positive in green or negative in red) is based on conviction and is not merely technical. PDVSA bonds are also trading around 35, near their all-time highs.
Key data from last week
🟡 Inflation Rate (CPI, Dec.): 2.7% vs. 2.7% expected → in line, confirming inflationary stability.
🟢 Core Inflation Rate (Dec.): 2.6% vs. 2.7% expected → better than expected, indicating underlying disinflation.
🟢 Retail Sales (Nov.): +0.6% vs. +0.4% expected → better than expected, strong consumer spending.
🔴 Core PPI (Nov.): 3.0% vs. 2.7% expected → worse than expected, cost pressures.
🟢 Existing Home Sales (Dec.): 4.35M vs. 4.21M expected → better than expected, improvement in housing.
🟢 Jobless Claims: 198K vs 212K expected → better than expected, solid job market.
🟢 Industrial Production (Dec.): +0.4% vs +0.2% expected → better than expected, resilient industry.
Key facts from this week
Thursday
• GDP Growth Rate QoQ Final (Q3): 4.3% expected
• Core PCE Prices QoQ Final (Q3): 2.9% expected
• Personal Income MoM (Nov): 0.3% expected
• Personal Spending MoM (Nov): 0.4% expected
Friday
• Michigan Consumer Sentiment Final (Jan): 54.0 expected
Momentum main markets
Bitcoin and gold are off to a strong start this year, while the US index lags behind international indices.
SP500 | 6’940 | +1.38% YTD (momentum: neutral)
Nasdaq100 | 25’529 | +1.11% YTD (momentum: neutral)
Euro Stoxx 50 | 6’015 | +3.38% YTD (momentum: sobrecomprado)
BTC | $95’314 | +9.04% YTD (momentum: neutral)
Oro | $4’601 | +5.99% YTD (momentum: neutral)
Treasury fees
- 1 year: 3.55%
- 2 years: 3.59%
- 5 years: 3.82%
- 10 years: 4.24%
- 30 years: 4.83%
Treasury Yield Spreads
As mentioned earlier, the bond market is often the best predictor of where the market is headed, and the spread between high- and low-quality bonds shows us whether the market perceives risks. Currently, the spread is very low, suggesting that the market sees few risks in the short term, despite geopolitical tensions. The US high-yield spread is at approximately 2.7%, well below its historical average (approximately 4%), indicating complacency and low credit stress.
Investment Styles
Value’s leadership suggests a rotation toward cheaper, more cyclical sectors, supported by resilient growth and high long-term interest rates. Momentum continues to capture the lead in winning trends, signaling continued appetite for selective risk. Low Volatility and Quality also outperform the index, indicating a market that balances risk with caution. Overall, this is not a pure beta rally, but rather a market of diversification and selection, where well-chosen factor strategies are outperforming the index.
Sectors
Top
- Industriales (XLI) +7.6%
- Materiales (XLB) +7.3%
- Energía (XLE) +6.7%
Flop
- Financieros (XLF) -0.6%
- Salud (XLV) +0.6%
- Tecnología / Nasdaq (QQQ) +1.1%
The leadership of the Industrials, Materials, and Energy sectors points to a cyclical rotation: real growth, infrastructure spending, and commodity prices are supporting the narrative. The lag in the Financials sector suggests that the yield curve and margins are not yet keeping pace, while Technology is falling behind after a very strong 2024, signaling a decentralization of leadership. Overall, the market favors value/cyclical stocks over defensive stocks and megacaps.
Sector valuation
Price/Earnings (P/E)
10–20× reasonable | 21–25× demanding | 26–30× expensive | >30× very expensive
1️⃣ Real Estate: ≈50.0× 🟥 (muy caro)
2️⃣ Technology: ≈39.0× 🟥 (muy caro)
3️⃣ Consumer Cyclical: ≈36.9× 🟥 (muy caro)
4️⃣ Basic Materials: ≈33.8× 🟥 (muy caro)
5️⃣ Consumer Defensive: ≈31.8× 🟥 (muy caro)
6️⃣ Industrials: ≈31.1× 🟥 (muy caro)
7️⃣ Health Care: ≈29.0× 🟨 (caro)
8️⃣ Communication Services: ≈26.9× 🟨 (caro)
9️⃣ Utilities: ≈21.2× 🟨 (exigente)
🔟 Energy: ≈18.8× 🟩 (razonable)
1️⃣1️⃣ Financial Services: ≈18.0× 🟩 (razonable)
📌 S&P 500 (SPX): ≈29.5× 🟥 (caro)
Valuation of key markets
Current P/E ratio vs. historical average
1️⃣ Nikkei 225 (Japan): 26.0× vs 14.8× → 🟥 Overvalued (+76%)
2️⃣ Nasdaq-100: 35.0× vs 24.8× → 🟥 Overvalued (+41%)
3️⃣ S&P 500 (USA): 29.5× vs 18.0× → 🟥 Overvalued (+64%)
4️⃣ Swiss Market Index (Switzerland): 24.3× vs 17.7× → 🟥 Overvalued (+37%)
5️⃣ Europe (Euro Stoxx 50): 25.0× vs 19.5× → 🟥 Overvalued (+28%)
6️⃣ DAX (Germany): 18.5x vs 15.3x → 🟥 Overvalued (+21%)
7️⃣ CSI 300 (China): 14.5x vs 14.0x → 🟨 Online (+4%)
Top world stock markets
There is a clear capital rotation from the United States to emerging markets and Europe, reflecting a search for more attractive valuations and risk diversification. This type of capital rotation is typically observed in the final phase of the economic cycle.
1️⃣ KOSPI (South Korea): +14.87%
2️⃣ BIST 100 (Turkey): +12.49%
3️⃣ Budapest SE (Hungary): +10.16%
4️⃣ TA-35 (Israel): +9.37%
5️⃣ Taiwan Weighted: +8.44%
6️⃣ Russell 2000 (Small Cap 2000): +7.89%
7️⃣ Nikkei 225 (Japan): +7.14%
8️⃣ PSEi Composite (Philippines): +6.80%
9️⃣ OMXC25 (Denmark): +6.46%
10🔟 Karachi 100 (Pakistan): +6.35%
1️⃣1️⃣ AEX (Netherlands): +6.19%
1️⃣2️⃣ SZSE Component (China): +5.59%
1️⃣3️⃣ BEL 20 (Belgium): +5.49%
1️⃣4️⃣ OMXS30 (Sweden): +5.42%
1️⃣5️⃣ IDX Composite (Indonesia): +4.96%
Top 15 S&P 500 Stocks YTD
1️⃣ Sandisk Corporation (SNDK): +74.24%
2️⃣ Moderna (MRNA): +41.84%
3️⃣ Lam Research (LRCX): +30.25%
4️⃣ KLA Corporation (KLAC): +29.03%
5️⃣ Western Digital (WDC): +28.58%
6️⃣ Intel (INTC): +27.26%
7️⃣ Applied Materials (AMAT): +27.25%
8️⃣ Micron Technology (MU): +27.10%
9️⃣ Huntington Ingalls Industries (HII): +25.24%
🔟 Builders FirstSource (BLDR): +23.23%
1️⃣1️⃣ Schlumberger (SLB): +21.76%
1️⃣2️⃣ Bunge Global (BG): +21.03%
1️⃣3️⃣ Lockheed Martin (LMT): +20.42%
1️⃣4️⃣ Comfort Systems USA (FIX): +20.00%
1️⃣5️⃣ Qnity Electronics (Q): +19.11%
Flop 15 S&P 500 stocks
1️⃣ Intuit (INTU): -17.68%
2️⃣ ServiceNow (NOW): -16.89%
3️⃣ GoDaddy (GDDY): -15.81%
4️⃣ AppLovin Corporation (APP): -15.59%
5️⃣ Adobe (ADBE): -15.39%
6️⃣ American International Group (AIG): -14.75%
7️⃣ Salesforce (CRM): -14.27%
8️⃣ Workday (WDAY): -13.00%
9️⃣ Constellation Energy (CEG): -12.90%
🔟 Datadog (DDOG): -12.48%
1️⃣1️⃣ Paramount Skydance Corp (PSKY): -11.94%
1️⃣2️⃣ Progressive Corporation (PGR): -11.13%
1️⃣3️⃣ Hewlett Packard Enterprise (HPE): -10.74%
1️⃣4️⃣ Autodesk (ADSK): -10.24%
1️⃣5️⃣ Expand Energy (EXE): -9.50%
1️⃣6️⃣ Las Vegas Sands (LVS): -9.43%
1️⃣7️⃣ DoorDash (DASH): -9.34%
1️⃣8️⃣ Charter Communications (CHTR): -9.10%
1️⃣9️⃣ Skyworks Solutions (SWKS): -8.89%
2️⃣0️⃣ HP Inc. (HPQ): -8.57%
Featured tweets
🤖 AI Portfolio Update – Week 4 (2026)
📊 Allocations – Week 4
(Δ vs. Week 3)
🔹 GLD (physical gold): 27% (↑ from 26%)
🔹 TLT (long-term U.S. Treasury bonds): 23% (↑ from 22%)
🔹 XLV (U.S. healthcare sector): 11% (=) ⚕️
🔹 VTC (U.S. investment-grade corporate bonds): 10% (=)
🔹 QQQ (Nasdaq-100):
🔹 SPY (S&P 500): 6% (↓ from 7%)
🔹 ACWX (global equities ex-U.S.): 6% (↓ from 7%)
🔹 SMH (semiconductors):
🔹 SHV (short-term Treasuries / cash): 3% (=) 💵
🔹 IWO (U.S. small-cap growth):
Total: 100%
🧠 Tactical Adjustments – Week 4 (2026)
1️⃣ Further reinforce late-cycle core (GLD +1%, TLT +1%)
Week 3’s thesis is being confirmed, not invalidated:
- Long yields are capped despite heavy issuance
- Real rates remain contained
- Risk premia are starting to matter again
Gold + duration are now structural ballast, not hedges.
2️⃣ Trim equity beta again, but surgically (SPY –1%, ACWX –1%)
This is risk management, not bearishness:
- Equity upside exists, but is asymmetric
- Breadth remains narrow
- International equities lack a clear catalyst
We reduce beta, not exposure to opportunity.
3️⃣ Hold defensives and quality unchanged (XLV, VTC)
No need to touch what is working:
- XLV continues to show relative strength
- Investment-grade credit offers carry + stability
- Default risk remains negligible
This is the sleep-well part of the portfolio.
4️⃣ Maintain selective growth optionality (QQQ, SMH unchanged)
AI and semis remain:
- Long-term structural winners
- Short-term valuation-constrained
We stay invested, but refuse to chase.
5️⃣ Cash stays neutral (SHV unchanged)
SHV remains:
- Dry powder
- Volatility buffer
No rush to deploy until we get either:
- A valuation reset, or
- A clear macro re-acceleration
🌐 Macro Backdrop – Week 4 (2026)
Markets are increasingly pricing:
- Late-cycle dynamics, not recession
- Slower growth, stickier inflation
- Higher dispersion across assets and factors
Leadership continues to favor:
- Gold
- Duration
- Quality balance sheets
- Defensive sectors
Risk assets are not broken — but they are fragile.
🎯 Strategy for Week 4 (2026)
- Capital preservation remains priority #1
- Let winners run, trim broad exposure
- Keep optionality for volatility events
- Prepare, don’t predict
This portfolio is designed to outlast noise and capitalize on dislocation.
In this phase of the cycle, discipline beats brilliance.
