This insight examines the early-February 2026 volatility in US tech and equities broadly to highlight the expected long-run effects of AI on the economy, specifically areas that the market views as likely to be disrupted by AI.
Outlook
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This week may bring a perfect storm, - quite literally, as a bomb cyclone spins off the Northeast coast. With options expiration now behind us, markets could face their own storm.
A stronger-than-expected jobs report initially sparked a rally midweek, but the momentum quickly faded. Stocks then came under pressure as AI disruption fears spread across several industry groups.
Two marquee macro reports this week—payrolls and the CPI—offered mixed signals on the economy. Our call for three Fed cuts this year stands. Mixed data signals continue around the globe.
Despite political noise around Fed appointments, policy outcomes will still be driven by the FOMC’s data-dependent framework, suggesting investors should focus more on rates, liquidity and duration positioning than headline risk.
Looking at data points seems like a waste of time. They used to matter, and given that the next Fed meeting isn’t until mid-March, the market will probably look through the report anyway.
The news from Venezuela, and another round of developments from across the world that may shape the course of markets over the next few months.
After the White House nominated Fed veteran Kevin Warsh as the next Fed chair, stocks opened lower Friday. A warmer-than-expected December wholesale inflation report and concerns about a government shutdown added to bearish investor sentiment as the week wrapped up
Markets are suffering sharp losses following an eventful three-day weekend that featured heightening geopolitical tensions amidst a violent selloff in Japanese debt that sent yields on the longest tenors to all-time highs.
It seems as though the Treasury may be preparing the market for a potential change in issuance sizes or duration at some point in the not-too-distant future, though that is admittedly speculative.
Stocks posted solid gains in an action-packed week of market-moving economic data, geopolitical news, and bullish new year sentiment. By Monday’s close, the Dow Industrials had gained enough to make the “Santa Claus Rally” a reality.
While the near-term market effect of the US capture of Venezuelan President Nicolas Maduro is minimal—beyond select US oil refiners, Venezuelan sovereign bonds, etc.—Maduro’s capture is a major geopolitical event with profound implications for the future.