🚀 State of the Union Takeaways

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Market Overview
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Year To Date Performances:

1. In a nearly two-hour State of the Union address delivered on Tuesday, President Donald Trump attempted to reclaim the economic narrative ahead of looming midterms by declaring a "roaring" national boom and taking credit for driving core inflation to its lowest level since 2021. Seeking to counter plummeting approval ratings and a resurgent Democratic lead, the President unveiled a populist "Savers Match" initiative—a government-backed 401(k) plan offering a $1,000 annual match for low-income workers—and called on Congress to codify his executive order banning institutional investors from purchasing single-family homes. While the speech largely pivoted away from foreign entanglements to focus on "kitchen-table" issues like retirement and housing affordability, it was punctuated by flashes of domestic tension, including the ejection of Representative Al Green and a pointed exchange with progressive lawmakers over the administration's aggressive deportation agenda. Despite the president's optimistic rhetoric, the address served as a high-stakes political life raft for a Republican party facing a potential loss of congressional control, leaving the administration to balance a "diplomacy-first" stance on a nuclear Iran against a domestic agenda increasingly defined by a defensive focus on the American middle class.

2. Nvidia has unveiled an exclusive first look at its next-generation AI powerhouse, Vera Rubin, a modular rack-scale system that delivers a staggering 10-fold increase in performance per watt over its Grace Blackwell predecessor. Scheduled to ship in the second half of 2026, the 2-ton rack represents a significant shift toward energy efficiency and maintenance ease, featuring a liquid-cooled architecture and a simplified "superchip" design where components slide out in seconds rather than being soldered to the board. Comprising 1.3 million individual parts sourced from a global supply chain of 80 vendors, each Vera Rubin system leverages 72 Rubin GPUs and 36 Vera CPUs to meet the insatiable compute demands of customers like Meta, OpenAI, and Microsoft. While the system is expected to command a premium price tag of up to $4 million and consumes twice the absolute power of previous models, its massive leap in "tokens per watt" efficiency is designed to provide the highest possible return on investment as hyperscalers face a critical shortage of power and memory.

3. Axon Enterprise shares skyrocketed more than 20% on Wednesday after the Taser and body-camera manufacturer delivered a blowout fourth-quarter earnings report, signaling a fundamental transformation from a hardware vendor into an AI-driven software powerhouse. Posting adjusted earnings of $2.15 per share on $797 million in revenue, the company handily beat Wall Street estimates as police departments aggressively adopt new AI-integrated tools like "Axon Assistant," a voice-activated body-cam companion that has already signed over 500 customers. While net income saw a technical dip due to strategic investments and operating shifts, the underlying growth story is centered on a 40% surge in software revenue, which finance chief Brittany Bagley expects will soon eclipse hardware sales as the company's primary growth engine. With $750 million in new bookings already tied to artificial intelligence and a bold 2026 revenue guidance of up to 30%, CEO Rick Smith is positioning Axon at the center of a "moment unlike anything" in the company’s 33-year history, betting that aggressive AI deployment in license plate readers and automated reporting will create an indispensable ecosystem for global law enforcement.

   Headlines

   1. Mortgage rates are at their lowest level in four years.

   2. David Tepper is pushing for management changes at Whirlpool.