Typically, when economists parse banks’ quarterly earnings, they’re looking for clues to consumer health: How much are customers saving? Can they keep up with their credit card payments?

But BNY Mellon isn’t an ordinary bank, and its earnings report yesterday offered a higher-level view of the economy — financial markets in particular.

Founded in 1784 by Alexander Hamilton, BNY isn’t a retail bank offering loans and deposit accounts to consumers. Instead, it’s a bank for banks, holding and safeguarding financial assets for institutional investors. One of the largest global custodians, BNY says it works with 92% of the Fortune 100 companies, 94% of the top 100 investment managers worldwide, 95% of the S&P top 100 banks worldwide, 94% of the top 100 largest US retirement funds and 98% of the top 50 life/health insurance companies. In other words, it’s so intertwined in the financial market that its earnings report can’t help but reflect broader market and economic trends.

The Room Where It Happens

A key metric for analyzing BNY’s earnings is assets under custody and/or administration (AUC/A), which show just how much the bank custodies for asset managers, hedge funds and other large investors. As of the latest earnings results, that figure is a whopping $59.3 trillion, up 3% from the previous quarter and 14% from the same time last year.

The increase primarily reflected “client inflows, higher market values and the favorable impact of the weaker US dollar,” according to a company statement. Investors put their money to work last year, with the S&P 500 closing out 2025 with a 16% gain while the Morningstar US Core Bond Index ended the year with a 7.12% gain, its highest since 2020.

BNY also saw boosts in fee revenue and interest income, helping the company to beat analyst expectations, and offered its 2026 outlook:

• Fee revenue, which provides insight into activity from key institutional investors, increased 5% year-over-year to $3.7 billion, indicating higher client activity. Net interest income jumped 13% from the fourth quarter of the previous year, reflecting continued reinvestment of maturing securities at higher yields and balance sheet growth, partially offset by deposit margin compression.
• The bank increased its medium-term targets for pretax margin and return on tangible common equity. Analysts at Truist wrote in a note Tuesday morning that there may be some disappointment that BNY’s outlook was not more ambitious, though they would see any weakness in the shares as a buying opportunity.

Fed Fight: BNY CEO Robin Vince joined JPMorgan Chase CEO Jamie Dimon in voicing support for the Federal Reserve’s independence amid President Trump’s attacks against Fed Chair Jerome Powell. Vince called the White House’s pressure on the Fed “counterproductive” to improving affordability, The Wall Street Journal reported. He also said Fed independence provides a critical underpinning of the bond market, and so “shaking at the foundation of it doesn’t seem to be to us accomplishing the administration’s primary objectives.”

Don’t call it a comeback.

Actually, wait. In this case, definitely call it a comeback.

Shares of Intel popped 7.3% on Tuesday after scoring an upgrade from KeyBanc Capital Markets analyst John Vinh, who said the company’s progress in leading-edge chips has positioned it to take Samsung’s spot as the world’s No. 2 foundry behind the Taiwan Semiconductor Manufacturing Company (TSMC). In this case, settling for the silver medal is pretty swell.

Leading Edge Of Your Seats

In extremely technical terms (that, quite frankly, we don’t understand but will try our best to communicate anyway), Vinh says Intel’s yields in the 18A-node chipmaking process — which occur on a staggeringly small scale of just 1.8 nanometers — have now reached 60%. That’s below the 80% yields that TSMC’s expertise scores, but better than the 40% yields KeyBanc estimates for Samsung. Translation: Intel is finally finding its footing in the exceptionally complex foundry game. Consider it a major win for a company that largely missed last decade’s smartphone tsunami, and is now trying its hardest to catch the ride-or-die AI wave.

Perhaps not-so-coincidentally, Intel is suddenly racking up a client list of heavy hitters:

• According to Vinh, hyperscalers, including Amazon Web Services and Meta, are now all evaluating Intel’s chip package for custom chip projects. Apple, meanwhile, has already tapped the company’s 18A process node for lower-end chips in MacBooks and iPads, and is considering Intel chips for future iPhones.
• In fact, according to Vinh, Intel is already nearly sold out of its server central processing units for the year; that could allow the company to increase prices for the units by as much as 15% this year. According to S&P Global Market Intelligence data, Intel’s Data Center and Artificial Intelligence unit is currently its third-largest in terms of revenue but second most profitable.

Made In America: The progress has earned Intel praise from one particularly important member of the audience: President Trump, who last year attempted to oust new CEO and longtime chip industry veteran Lip-Bu Tan, before changing his tune and leading the government to take a 10% stake in the chipmaker. “The United States government is proud to be a shareholder of Intel … Our country is determined to bring leading-edge chip manufacturing back to America, and that is exactly what is happening,” the president said in a Truth Social post this week. Speaking of Made in America: The Wall Street Journal this week reported that TSMC may soon significantly expand its operations in Phoenix, Arizona, where it opened a chip foundry in 2024.

Small business is thinking big.

In a survey published Tuesday, the National Federation of Independent Business (NFIB) said its small-business optimism index jumped in December to 99.5, up from 99 the month before and above its long-term average of 98. So what’s got Main Street feeling so rosy all of a sudden?

Small Business, Big Dreams

Well, lots of reasons, as it turns out. For one thing, the rise in optimism is inversely correlated to a decrease in uncertainty, which spiked through last spring and summer amid the White House’s tariff tussles. Speaking of: The US Supreme Court could rule as soon as today on the legality of the president’s tariffs-via-emergency-order play. Either outcome would only provide more certainty moving forward, though a blow against the tariff regime would likely be welcome for small business owners who cited taxes and inflation as their first and third most important issues.

Their second-most cited issue moving forward? Finding quality labor — and it’s here where the NFIB typically provides its most useful indicator:

• 19% of respondents said finding quality labor was the biggest challenge they faced, just a point behind “taxes.” Meanwhile, 33% of respondents said they had job openings in December that they were unable to fill, with nearly half of owners saying they found few or no qualified candidates for open positions.
• The unfilled job openings rate remains well above the historical average of 24%, though it has improved somewhat in the past year. The NFIB survey is typically an accurate predictor of the US Bureau of Labor Statistics’ monthly non-farm payroll jobs report.

If Any Indication: Also well above historical norms? You guessed it: selling prices. A net of 30% of owners said they increased selling prices in December. That’s down from 34% in November, but above the historical average of 13%. The inflation indicator was mirrored in the Consumer Price Index report also released Tuesday by the US Bureau of Labor Statistics. In December, the CPI rose to 2.7%, while the core CPI, which excludes food and energy costs, rose 2.6%. The bottom line? “In the near term, inflation will run hotter than policy makers would like, so we expect the Fed to pause this month and possibly in March … For now, the balance of risks tilts toward the weakening labor market,” Jeffrey Roach, chief economist for LPL Financial, told The Daily Upside.