In just three days this week, we’ll get the Federal Reserve’s next interest rate decision, the PCE indicator (which contains the Fed’s preferred inflation gauge), and the economy’s key monthly jobs report. This will paint a pretty vivid canvas. If inflation pressures faded, if the job market showed further signs of slowing, and if the Fed sticks to its recent talking points, investors are likely to keep on keeping on. With that kind of big picture backdrop, they’ll feel pretty reassured that the central bank will deliver some economy-boosting interest rate cuts later this year. But if inflation proves sticky, job growth reaccelerates, and if the Fed chief veers off-script, the whole landscape could shift fast. With the yield on the 10-year Treasury hovering near 4.5% – a level that’s historically preceded market corrections – that’s just what some people will be watching for.

That’s not all that’s happening. Another crop of Big Tech names will deliver quarterly updates this week, and the bulls are feeling good about it. Earnings revisions have been moving higher of late, and margins are expected to get a double-stuffed lift from easing wage costs and new tax breaks. Not only that, but the weaker US dollar has been boosting the profits of many companies, with overseas revenue suddenly worth even more when converted to greenbacks. That could trigger some healthy operating leverage – i.e. what happens when profit rises faster than revenues – and keep valuations afloat even without immediate interest rate cuts. Bears aren’t so sure about all that: they argue the bar is too high, investors too complacent, and Big Tech stocks too crowded. Any disappointment in corporate forecasts, a slowdown in AI enthusiasm, or any other unhappy surprise could shake things right up.

Regardless of your view, there’s been a definite shift playing out beneath the market’s surface this year. While meme stocks and AI darlings have dominated investor attention, other sectors have been posting far bigger gains just off-screen. Old-school industrials, financials, and materials have been the market’s top performers. This could be a very good thing, signalling that the rally is broadening and that investor confidence in the real economy is growing. If that shift sticks around, it could have real consequences: portfolios that have been all-in on tech might underperform, while active investors who can spot strength in less-crowded corners could finally get rewarded. Mind you, that all depends on macro and earnings not throwing a curve ball.