Interactive Broker's Torres: The economy is running hot, but the market will fall in '26

Jose Torres, senior economist at Interactive Brokers, says the economy is strong and "not looking at a recession here," but that hot economy benefits cyclical stocks rather than the Magnificent Seven stocks, and that limits just how much the market can gain ground. With technology "set for a down year," the other areas of the market can't generate enough gains — even in a robust economy — to make 2026 positive. He also notes the market has been running in a "three year on, one year off" cycle, and he thinks that will impact tech companies this year." Torres still expects rate cuts and thinks any downturn will be relatively short lived and not too deep, but enough for where investors should adjust their expectations.

John Cole Scott, president of CEF Advisors, sizes up the prospects for the first new IPO the closed-end fund industry has seen in several years, and from a surprising source. Robinhood markets, the investment platform, will launch next week Robinhood Ventures Fund I, a concentrated portfolio of private companies. Scott, who also serves as chairman of the Active Investment Company Alliance, discusses the role private equities can play in a portfolio, as well as the challenges investors face in sizing up a fund with a net asset value entirely based on the "value" of illiquid shares that don't trade in public markets.

Billy Hensley, president of the National Endowment for Financial Education discusses the group's recent poll on how American adults view their financial well-being, which found that seven of eight respondents were feeling some form of financial stress as they entered the year, with more than three-quarters of all respondents having suffered a financial setback in 2025.