Messy

Suffice to say that markets have been trading in messy fashion of late... Correlations that you could count on since the beginning of the year were seemingly breaking down amid some notable rotation away from the ytd winners, into the losers (and the lagging winners).

Today, however, looks more like the previously established "norm." Gold, for one example, rising alongside rising equities, falling yields, and declining/stabilizing energy prices.

Per the synopsis below, this morning's inflation data came in hot, although at to slightly below expectations... Markets, for the moment, are trading that as a relief, alongside stellar earnings reported by Micron Technology last evening... The latter being an event that was approaching with great trepidation... Thus, additional relief there.

The real near-term tell will be whether or not today's rally gets faded over the coming days.

Our (always subject to change) current base case view remains constructive in the near-term -- say, July into October... We're less-sanguine beyond, based on current visibility.

In the meantime, here's today's morning rundown*: 

Market Note* — Thursday, June 25, 2026

This morning brought the inflation reading the Federal Reserve watches most closely, and it confirmed what we've been telling you for some months now: price pressures are proving stickier than the consensus would like. Headline inflation on this measure rose to its fastest annual pace since the spring of 2023, with the core reading — which strips out food and energy to show the underlying trend — at its highest since the fall of that year. Both came in essentially where economists expected, so this was not a shock; it was a confirmation. Alongside it, household income and spending both rose at a healthy clip, and jobless claims came in lower than forecast. Taken together, the picture is one of an economy where demand remains firm and the labor market is holding, even as inflation refuses to fully cooperate.

That combination — resilient activity paired with persistent inflation — sits at the center of the framework we've been managing toward all year. It is also why the Fed has shifted its tone, stepping back from the rate cuts markets had hoped for and signaling it intends to keep its focus squarely on bringing inflation down. We have positioned the portfolio for this environment rather than for the gentler path many were expecting, and today's data reinforces that discipline.

What's notable is how markets responded. Rather than selling off on a hot inflation number, the broad market rose — and importantly, the strength was widespread rather than concentrated in a handful of large technology names. For much of this year, market gains leaned heavily on a small group of giant companies; today, participation broadened meaningfully, with industrials, infrastructure, healthcare, and value-oriented areas leading the way. That broadening is something we view constructively. A market that advances on the strength of many companies rather than a few rests on firmer footing, and it plays directly to how our portfolio is built — with deliberate exposure across sectors and regions rather than a concentrated bet on any single theme.

Our internal conditions gauge has now improved for several consecutive readings, reflecting a backdrop that, while far from carefree, has been gradually firming beneath the surface. We are not declaring the inflation fight over — far from it — and we continue to watch developments in the Middle East and energy markets closely, since those carry direct implications for the path of prices from here. But the portfolio is constructed to hold up across a range of outcomes rather than to depend on any one of them, and today's session was a reminder of why that approach matters.

As always, we're managing this actively and will keep you informed as conditions evolve.

This note is for informational purposes only and should not be construed as investment advice or a recommendation to buy or sell any security. Past performance is no guarantee of future results.

*Prepared by Marty Mazorra, Chief Investment Officer, Private Wealth Advisors. Research synthesis and drafting assisted by AI tools under advisor review. All market views, analysis, and recommendations are those of the advisor.