New Federal Reserve Chairman, Kevin Warsh and his cohorts at the FOMC left the fed funds target at 3.5% to 3.75%. But it's clear that there's a different sheriff in town and that there will be little, if any, forward guidance on monetary policy and only a bland characterization of how the economy is doing. While acknowledging the Fed's dual mandate of maximum sustainable employment and price stability, Mr. Warsh did acknowledge, 'we've got some work to do on the price stability front.' The 2-year Treasury yield shot up to 4.19% from 4.06% midday and was up 14 basis points (bps) on the day. That was the highest yield close for the 2-year since February 2025 and leaves the historically trusty leading indicator of the fed funds rate looking for at least a few 25 bps hikes. The CME FedWatch Tool is now looking for one or two small hikes by the end of 2026. The stock market sniffed out uncertainty concerning monetary policy with at least a hawkish tint -- and didn't like it one bit. The S&P 500 fell 1.2%, more than filled its recent price gap, and is back below its 21-day exponential moving average (EMA) on a minor basis. The index has given back half of its recent three-day rally. The Nasdaq 100 (QQQ) fell 1%, filled its price gap, and remains above its 21-day EMA. Breadth was weak, with 2.2% to 2.8% losses in four sectors. Communication Services were hit the hardest, followed by Real Estate, Consumer Discretionary, and Consumer Staples. Healthcare, Materials, Utilities, and Energy declined 1.3% to 1.5%. It's only one day and the market knew Warsh would give less guidance, so perhaps cooler heads will prevail.

Ulta Beauty is a leading retailer of cosmetics, fragrances, skin care, haircare, bath, and beauty products, with a salon services segment specializing in hair styling and make-up. Founded in 1990, the company is based in Bolingbrook, Illinois, and has approximately 21,000 full time employees. The company operates over 1,500 Ulta Beauty stores across 50 states and over 80 Space NK stores in the U.K. and Ireland.

AI is helping lift profits at consumer companies on multiple levels. It allows companies to better understand their customers, which can improve target marketing and customization. Companies can hone menus, goods, and services to achieve broader appeal and to reach new audiences. Consumer companies are also harnessing AI technology to help with processes, inventory control, and supply-chain management, and in many other ways. By way of examples, restaurants are using smart robots to take orders, and prep and serve food. They also have front and back offices, and AI is helping make both more efficient and cost effective. As well, consumer companies utilize a lot of data, and AI helps elevate the use of that data. We recently concluded our five-part webinar series on AI, looking at how different industries are using AI. Our final event spotlighted consumer companies. For this week's list, we offer details on the BUY-rated stocks we highlighted during the webinar.

Since the onset of the war in Iran, the U.S. Treasury yield curve has maintained an upward slope, signaling economic growth in the quarters ahead. But it also has shifted a bit, with a few implications for economic and interest rate outlooks. First, the curve has pushed higher. Back in late February, the 2-year Treasury note yield was 3.4% and the 10-year yield was 4.0%. Now, those rates are 4.1% and 4.6%, respectively. At current levels, these rates are as high as they have been for a year. This shift higher in the yield curve implies that inflation may be poised to make a comeback, likely driven by higher energy prices as the cost for oil skyrocketed. Second, the upward slope of the yield curve has flattened out a bit. In late February, the spread between the 2-year and 10-year bonds was 60 basis points. Now, the spread is down to 50 basis points. This tightening of the yield curve points toward a potential slowdown in the rate of economic growth (though we note that the curve is nowhere near an inverted state, which has long been associated with economic weakness). Looking ahead, we anticipate that the yield curve will maintain its upward slope through 2027. This assumes that the war in Iran ends in the not-too-distant future, oil prices come down off their highs, and the Federal Reserve, with a new chairman at the helm, can be in position to lower short-term interest rates within the next few quarters.