The Markets (as of market close February 20, 2026)
U.S. equities staged a strong late week rally on Friday to finish in positive territory. Stock traders initially moved into “risk-off” mode amid rising inflation pressures and slowing economic growth. Markets rebounded sharply following a Supreme Court ruling against U.S. government tariffs, lifting the S&P 500 back above 6,900 and pushing the Dow past 49,600. The NASDAQ snapped a five-week losing streak. Industrials, communication services, and utilities each gained more than 2%, while consumer staples was the only sector to close lower. Treasury yields edged slightly higher as bond markets reacted to the tariff ruling, softer growth data, and ongoing geopolitical tensions.
Last Week’s Economic News
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Fourth-quarter GDP expanded at a 1.4% annualized rate.
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Personal income and disposable income rose in December, while consumer spending also increased.
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Inflation ticked higher, with consumer prices rising 0.4% in December and 2.9% year-over-year; core prices rose 3.0% over the past 12 months.
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The trade deficit widened in December, amid shifting tariff policies.
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Housing activity was mixed, with building permits and housing starts improving month-over-month, while new home sales declined slightly from November but remained above year-ago levels.
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Durable goods orders fell slightly in December, though orders excluding transportation rose.
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Industrial production increased in January, supported by gains in manufacturing and utilities.
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Weekly jobless claims declined to 206,000, signaling continued labor market stability.
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Gasoline prices rose slightly, but remain well below year-ago levels.
Eye on the Week Ahead
Speculating stock traders will monitor January durable goods orders, the advance trade report, and the latest Producer Price Index data. Producer prices rose 0.5% in December and were up 3.0% over the prior 12 months, making this week’s inflation readings especially important for market direction.
Have a nice week!
Sincerely,
Robert G. Carpenter