There's no debate that 2026 started with a BIG BANG: Charles Payne

Key Concepts

• JOLTS Report: Job Openings and Labor Turnover Survey – a measure of job openings, hires, and separations.
• ISM Services PMI: Institute for Supply Management Services Purchasing Managers' Index – an economic indicator of the health of the services sector.
• Trump Correlation: The observed relationship between market performance and the actions/policies of Donald Trump.
• Monroe Doctrine: A US foreign policy regarding European colonization of the Americas.
• Russell 2000 vs. S&P 500: Comparison of performance between small-cap (Russell 2000) and large-cap (S&P 500) stocks.

---

Economic Data & Market Performance – Early 2026 “Big Bang”

The speaker characterizes the beginning of 2026 as experiencing an economic “Big Bang,” referencing significant shifts and developments across multiple fronts. This isn’t related to cosmological theory, but rather a metaphor for rapid and impactful changes. Specifically, the speaker highlights developments in geopolitics and economic indicators.

Geopolitical Developments

The speaker points to the resurgence of the Monroe Doctrine, evidenced by the U.S. seizure of a Russian-flagged oil tanker originating from Venezuela. This event, described as a weeks-long “cat and mouse” game, signifies a more assertive U.S. foreign policy in the region. The speaker also dismisses the relevance of the “Trump correlation,” suggesting that market dynamics are now driven by other factors.

JOLTS Report Analysis – Labor Market Cooling

A key focus is the JOLTS (Job Openings and Labor Turnover Survey) report released that morning. The report indicates a significant decrease in job openings, falling to 7.15 million, down from 7.6 million. This represents the lowest point in the current economic cycle, signaling a cooling labor market. The speaker emphasizes the “phenomenal” nature of this decline, suggesting it’s a positive development.

ISM Services PMI – Strong Expansion

The ISM Services PMI (Purchasing Managers' Index) also showed a substantial increase, reaching 54.4. This is the highest reading since October 2024 and significantly exceeded market expectations of 53.2. The speaker breaks down key components:

• Prices Paid: Decreased slightly to 57.9 from 52.9, which is viewed favorably as a sign of easing inflationary pressures.
• Employment: Increased to 48.9. The speaker notes that any reading above 50 indicates expansion in the services sector, confirming positive growth.

Overall, the speaker interprets the ISM Services PMI as demonstrating positive momentum and expansion within the service economy.

Market Sector Performance – Shifting Leadership

The speaker observes a potential “changing of the guard” in market leadership. Year-to-date, materials are leading gains with a 4.7% increase. Industrials, financials, and healthcare are also performing well, while communication services are lagging. Notably, the Russell 2000 (small-cap stocks) is significantly outperforming the S&P 500. This is a reversal of the trend observed at the end of the previous year, where small caps were in “absolute free fall” relative to the S&P 500. This shift suggests a potential rotation towards smaller companies.

Synthesis & Takeaways

The speaker presents a bullish outlook based on the morning’s economic data. The cooling labor market (JOLTS report) combined with strong growth in the service sector (ISM Services PMI) and a shift in market leadership towards small-cap stocks paints a picture of a strengthening economy. The geopolitical event (oil tanker seizure) is presented as a demonstration of U.S. assertiveness. The overall message is that 2026 is beginning with significant positive momentum, justifying the “Big Bang” analogy.