
US financials were big winners in 2025 and they're off to a strong start in 2026

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US financials had a strong performance in 2025, with the XLF ETF rising 13.6%, driven by Wells Fargo and JPMorgan Chase. In 2026, financials are expected to benefit from AI adoption, potentially displacing 54% of banking roles, leading to significant cost savings. However, there are concerns about overpricing profitability improvements without considering risks to lending amid rising unemployment. The XLF is currently up 2.7%.
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