Markets rallied across the board this week, with Nasdaq leading at +2.08% and Dow Jones lagging at +0.56%. On the safe-haven front, Gold climbing 1.42% to $5,080.90 while the 10-year yield falling to 4.08% while the dollar strengthening 0.72% to 97.80.
The macro picture was busy. Housing Starts came in below expectations (1.37M vs. 1.42M). S&P Global Flash Services PMI came in below expectations (49.7 vs. 53.0).
Looking ahead, the key events to watch are: Q4 GDP (Second Estimate), PCE Price Index. Position sizing and hedges should reflect the potential for volatility around these releases.
Stocks inched higher but nothing to write home about. The S&P 500 was up just +1.4% — markets moved but didn't go anywhere decisive.
Gold was up slightly (+1.4%) — a mild safe-haven bid, but nothing that signals serious alarm.
Bond yields were relatively stable at 4.08% — no dramatic signal from the rates market this week.
The dollar strengthened +0.7%. A stronger dollar is a quiet headwind if you hold international stock ETFs — the gains overseas get partially erased when converted back to USD.
On the economic data front:
- Manufacturing activity expanded this week (PMI of 51.6). Factories are busier — generally positive for industrial stocks.
- The services sector — which drives most of the U.S. economy — unexpectedly contracted (PMI of 49.7, below the 50 line that separates growth from contraction). That's a meaningful warning sign.
The bottom line: A solid week. The macro backdrop is supportive, and the market reflected that. Stay invested but keep an eye on the data coming next week — a surprise in either direction can quickly change the tone.
Watch next week: Q4 GDP (Second Estimate) and PCE Price Index are the key releases. These can move markets — particularly bonds and rate-sensitive sectors — so it's worth being positioned before the prints rather than reacting after.
📈 Large Cap
📊 Broad Market
🏦 Fixed Income
| Index | Close | Weekly % | Week Range |
|---|---|---|---|
| Nasdaq | 22,886.07 | +2.08% | 22,380.00 – 22,930.00 |
| S&P 500 | 6,909.51 | +1.45% | 6,798.30 – 6,915.86 |
| Gold | 5,080.90 | +1.42% | 4,859.77 – 5,088.00 |
| Russell 2000 | 2,663.78 | +1.28% | 2,622.00 – 2,675.00 |
| USD Index | 97.80 | +0.72% | 96.85 – 98.08 |
| Dow Jones | 49,625.97 | +0.56% | 49,280.00 – 49,750.00 |
| 10Y Treasury | 4.08 | +0 bps | 4.04 – 4.10 |
| Date | Event | Actual | Expected | Previous | Surprise |
|---|---|---|---|---|---|
| 2026-02-18 | FOMC Meeting Minutes | -- | -- | -- | Inline |
| 2026-02-19 | Housing Starts | 1.37M | 1.42M | 1.5M | Below |
| 2026-02-20 | S&P Global Flash Manufacturing PMI | 51.6 | 51.5 | 51.2 | Inline |
| 2026-02-20 | S&P Global Flash Services PMI | 49.7 | 53.0 | 52.9 | Below |
📊 FOMC Meeting Minutes
Minutes reaffirmed the Fed's data-dependent stance with no imminent rate cuts. Officials noted progress on inflation but flagged uncertainty around tariffs and labor market resilience.
📊 Housing Starts
Weaker housing starts signal affordability pressure and builder caution. Rate-sensitive homebuilder ETFs (ITB, XHB) may face headwinds until mortgage rates ease.
📊 S&P Global Flash Manufacturing PMI
Manufacturing activity continues to expand modestly. Neutral to mildly positive for industrials (XLI). No major change to the macro narrative.
📊 S&P Global Flash Services PMI
Services sector unexpectedly contracted -- a notable miss. Consumer-facing and discretionary sectors (XLY, XLP) may see volatility. Watch for confirmation in ISM Services next week.
| Date | Event | Importance |
|---|---|---|
| 2026-02-24 | Consumer Confidence | Medium |
| 2026-02-25 | Durable Goods Orders | Medium |
| 2026-02-26 | Q4 GDP (Second Estimate) | High |
| 2026-02-27 | PCE Price Index | High |
| 2026-02-27 | Personal Income & Spending | Medium |
| Signal | Suggested Action |
|---|---|
| USD Index strengthened +0.72% this week | A stronger dollar weighs on multinational earnings and commodities. Consider reducing exposure to export-heavy sectors and commodity ETFs (GLD, DJP). |
| Housing Starts missed at 1.37M vs. 1.42M | Affordability pressure weighs on homebuilders (ITB, XHB). Watch mortgage rate trajectory before adding real estate exposure. |
| Services PMI missed at 49.7 vs. 53.0 expected | Services sector contraction is a caution signal. Consider trimming consumer discretionary (XLY) and adding defensives (XLP, XLU). |
| GDP release on 2026-02-26 | A weak print could shift sentiment toward defensives (XLU, XLP); a strong beat supports risk-on positioning in cyclicals (XLY, XLI). |
| PCE Price Index on 2026-02-27 | The Fed's preferred inflation gauge. A hot print could reprice rate-cut expectations; consider hedging bond duration (TLT) and adding inflation protection (TIPS, GLD). |