Ideal situation for markets is less Fed, says Michael Santoli

Summary

Michael Santoli previews the jobs report, a potential new Fed chair, and a Supreme Court tariff ruling, focusing on how markets are positioned. He says the market expects new Fed leadership to bias rates lower and is pricing in policy-driven hot economic growth. He warns that the hot-economy trade, including equal-weight consumer discretionary and banks, is being forced in advance and could struggle if growth data disappoint. Treasury yields remain tame and have not obstructed stocks.

• Michael Santoli discussed upcoming jobs, Fed leadership, and tariff catalysts.
• He said markets expect new Fed leadership to mean lower rates.
• He saw the tariff ruling as a possible opportunity to loosen trade restrictions.
• He warned the market is front-running a hot-economy policy trade.
• Equal-weight consumer discretionary and banks have been notably strong.
• Those sectors may not trade well if economic momentum disappoints.
• Treasury yields remain tame and have not disrupted equities.
• The transcript ends mid-sentence.