Major banks are preparing to launch the first quarter earnings season. Slatestone Wealth chief market strategist Kenny Polcari joins Morning Brief to discuss earnings outlook and potential market implications. "There’s a different sentiment now about where people feel about the market, to where they feel about the Fed and where they feel about inflation," Polcari tells Seana Smith and Brad Smith. He suggests that, while earnings may be positive, concerns about the Federal Reserve and inflation could "trump the way people feel." Regarding bank earnings, Polcari emphasizes, "This earnings season, I think you have to pay attention to loan loss reserves." He explains that these are funds banks set aside to protect against defaults, noting that if these reserves increase, "that gives you a sense of what they really expect" regarding broader economic health and consumer stability. On Federal Reserve policy, Polcari firmly believes the central bank shouldn’t cut rates in 2025. He adds, "I am in the camp that not only are we not going to get another cut, but the risk is to the upside."
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