S&P 500, Nasdaq Composite rally back into record territory

The stock market delivered another strong advance this week, with equities moving back into record territory as falling oil prices, improving geopolitical conditions, and powerful leadership from mega-cap and technology stocks drove index-level gains.

The macro backdrop steadily improved throughout the week. While early uncertainty lingered after the U.S. and Iran failed to secure a more durable agreement over the weekend, sentiment shifted as renewed talks were signaled and the existing ceasefire held. By Friday, news that the Strait of Hormuz would reopen during the ceasefire period, along with reports of upcoming negotiations in Pakistan, marked a meaningful de-escalation.

Crude oil responded decisively, extending its weekly decline to roughly $12 per barrel and settling below $85. That sharp drop helped ease inflation concerns and improve the outlook for potential rate cuts, reinforcing a supportive environment for equities.

Against that backdrop, the S&P 500 (+4.5%), Nasdaq Composite (+6.8%), and DJIA (+3.2%) all posted strong week-to-date gains, with the Nasdaq’s significant outperformance underscoring the market’s rotation back into growth and AI-driven leadership.

Participation broadened notably beneath the surface. The Russell 2000 (+5.6%) and S&P Mid Cap 400 (+3.5%) both advanced solidly, with small caps outperforming the broader market as risk appetite strengthened alongside improving macro conditions.

Sector performance reflected a clear risk-on tone. Growth-oriented areas led decisively, with information technology (+8.1%), communication services (+6.3%), and consumer discretionary (+6.6%) posting outsized gains.

Semiconductor stocks also contributed meaningfully, reinforcing the strength of the broader AI trade. 

Outside of growth, cyclical participation improved as falling oil prices provided a tailwind. Financials (+3.3%) and real estate (+3.8%) advanced, while industrials (+1.2%) posted more modest gains. In contrast, defensive sectors lagged, with utilities (-1.7%) and consumer staples (flat) reflecting reduced demand for safety. The energy sector (-3.4%) was the clear underperformer, pressured by the sharp decline in crude prices.

All told, this week reinforced the market’s strong upward momentum. A combination of easing geopolitical tensions, sharply lower oil prices, and renewed leadership from both mega-cap technology and previously lagging areas has strengthened the foundation of the rally. With participation broadening and key growth segments reasserting dominance, the market appears increasingly well-supported as it pushes deeper into record territory.

• Nasdaq Composite: +6.8% week-to-date

• Russell 2000: +5.6% week-to-date

• S&P 500: +4.5% week-to-date

• S&P Mid Cap 400: +3.5% week-to-date

• DJIA: +3.2% week-to-date

Ceasefire rally drives broad gains amid oil retreat and AI leadership

Stocks posted solid gains this week as a two-week ceasefire agreement between the U.S. and Iran helped ease geopolitical risk and drive a sharp decline in oil prices, supporting a broad-based rebound in equities. 

The S&P 500 (+3.6%), Nasdaq Composite (+4.7%), and DJIA (+3.0%) all advanced, while the Russell 2000 (+4.0%) and S&P Mid Cap 400 (+3.4%) also finished higher, reflecting broad participation across the market.

Sector leadership was concentrated in growth and AI-linked areas, with communication services (+5.8%) and consumer discretionary (+5.8%) leading, alongside information technology (+4.8%).

Within tech, semiconductor strength was a key driver, while software lagged. Mega-cap growth also contributed, due to solid gains from Amazon (+13.7%) and Meta Platforms (+9.6%).

Industrials (+4.7%) and materials (+3.5%) posted strong gains as well, while financials (+2.4%), real estate (+2.9%), utilities (+1.3%), consumer staples (+0.5%), and healthcare (+0.4%) all finished higher but more modestly. Energy (-4.1%) was the clear laggard as crude oil fell nearly $15 per barrel amid easing geopolitical risk.

Friday’s March CPI report provided the key macro check late in the week, with headline inflation running hotter due to energy costs while core inflation was more contained. Overall, the week was defined by easing geopolitical tensions, a sharp reversal in oil prices, and continued leadership from AI and semiconductor-related equities, with focus now turning to upcoming U.S.–Iran talks for clarity on whether the ceasefire can evolve into a more durable agreement.

• Nasdaq Composite: +4.7% week-to-date

• Russell 2000: +4.0% week-to-date

• S&P 500: +3.6% week-to-date

• S&P Mid Cap 400: +3.4% week-to-date

• DJIA: +3.0% week-to-date

Markets climb on geopolitical optimism and relief rally

Stocks posted solid gains this week as hopes of a de-escalation in the U.S.-Iran conflict supported sentiment, helping the major averages recover some of March’s losses.

The S&P 500 (+3.4%), Nasdaq Composite (+4.4%), and DJIA (+3.0%) all advanced, while smaller-cap benchmarks like the Russell 2000 (+3.3%) and S&P Mid Cap 400 (+2.9%) also finished higher.

Sector performance was led by growth-oriented and communication-related areas, with the communication services sector (+6.4%) and information technology sector (+4.6%) outperforming. Financials (+3.6%), real estate (+3.8%), and materials (+3.4%) also posted solid gains, while the energy sector (-5.3%) lagged amid volatile oil prices.

Tech leadership was supported by a rebound in semiconductor stocks. Mega-cap growth also advanced. Some of the week’s gains were likely due to positioning after oversold conditions earlier in the week, as geopolitical developments remained volatile.

Geopolitical developments drove market swings. Early optimism following President Trump’s comments on Iran’s potential concessions lifted markets, while midweek reports of ceasefire discussions fueled a broad rally. Thursday saw renewed volatility as threats of continued military action coincided with sharply higher oil prices, but the major averages ultimately finished the session near flat.

Fed Chair Jerome Powell noted that inflation expectations remain well anchored beyond the short term and emphasized that the Fed’s tools have limited impact on supply shocks, which contributed to a pullback in market-implied rate expectations.

Overall, the market finished the week higher, with gains reflecting a mix of optimism over potential geopolitical progress, relief rallies after oversold conditions, and a rebound in mega-cap and tech names, even as oil prices and uncertainty around Iran keep the market on a cautious footing.

• Nasdaq Composite: +4.4% week-to-date
• S&P 500: +3.4% week-to-date
• Russell 2000: +3.3% week-to-date
• DJIA: +3.0% week-to-date
• S&P Mid Cap 400: +2.9% week-to-date

Oil volatility drives rotation as mega-caps weigh on the market

The stock market moved lower again this week, with the S&P 500 (-2.1%) and Nasdaq Composite (-3.2%) pacing the decline, while the Dow Jones Industrial Average (-0.9%) held up relatively better.

Beneath the surface, however, the action told a more nuanced story—one defined by sharp rotations, mega cap weakness, and continued sensitivity to oil-driven geopolitical developments.

The week began on a strong note, as a sharp pullback in oil prices—driven by hopes of a potential pause in hostilities between the U.S. and Iran—sparked a broad risk-on rally. All eleven sectors advanced on Monday, and the S&P 500 and DJIA briefly reclaimed their 200-day moving averages. However, that optimism proved fleeting, as conflicting reports around negotiations quickly reintroduced uncertainty.

From there, markets struggled to gain traction. Oil resumed its volatile swings, and Treasury yields moved higher overall, creating a difficult backdrop for equities— particularly large-cap growth stocks. While there were intermittent bouts of strength tied to dips in oil prices, each rebound attempt was capped near key technical resistance levels.

A key theme throughout the week was the pronounced divergence between mega-cap stocks and the broader market. The Nasdaq Composite underperformed sharply, weighed down by significant losses in the communication services (-7.2%) and information technology (-3.5%) sectors. Weakness in mega-cap names—particularly across software and internet platforms—was a persistent drag.

In contrast, smaller-cap stocks showed relative resilience for much of the week, with the Russell 2000 (+0.5%) and S&P Mid Cap 400 (+0.4%) managing gains. Additionally, more commodity-linked areas outperformed, highlighting a clear rotation away from growth.

The energy sector (+6.2%) led all gainers as oil prices ultimately pushed back toward the $100 per barrel mark by week’s end, despite early volatility. The materials sector (+4.2%) also posted strong gains, supported by strength in chemicals and metals amid ongoing supply concerns tied to Middle East tensions.

Defensive sectors saw steady inflows as well, with utilities (+2.9%) and consumer staples (+1.2%) outperforming, particularly during the latter part of the week as risk sentiment deteriorated.

By Thursday and Friday, selling pressure intensified. Rising oil prices, climbing Treasury yields, and escalating geopolitical rhetoric combined to drive broad-based losses. Mega-cap stocks led the decline, with all of the “Magnificent Seven” finishing lower on Friday, while continued weakness in software and semiconductor stocks compounded the downside.

Ultimately, this week reinforced a market increasingly shaped by external macro forces—namely, oil prices and geopolitical developments. While there were signs of resilience beneath the surface earlier in the week, persistent weakness in mega-cap stocks and repeated failures at key technical levels left the broader market vulnerable.

As long as oil remains volatile and geopolitical uncertainty persists, the path forward for equities is likely to remain uneven, with sector rotation and macro sensitivity continuing to define price action.

Higher Oil, Higher Yields, Lower Stocks

The stock market turned lower again this week as rising oil prices reshaped the inflation outlook, Federal Reserve expectations, and overall market sentiment.

The S&P 500 fell 1.9%, while the Nasdaq Composite and Dow Jones Industrial Average each declined 2.1%, with all three major averages breaking further below key technical levels by Friday.

The week began on a more constructive note, as a pullback in crude oil helped fuel a broad rebound and briefly pushed the Nasdaq Composite back above its 200-day moving average. However, that optimism faded quickly as oil resumed its climb and geopolitical risks surrounding the Strait of Hormuz intensified.

By midweek, the focus shifted squarely to inflation and monetary policy. A hotter-than-expected PPI report reinforced concerns that price pressures remain sticky— even before factoring in the recent surge in energy prices. T hose concerns were further cemented following the FOMC decision.

While the Fed left rates unchanged, the updated Summary of Economic Projections showed higher inflation expectations, with PCE rising to 2.7% from 2.4%. Importantly, Fed Chair Jerome Powell acknowledged that the possibility of future rate hikes was at least discussed, signaling a more cautious stance than markets had anticipated. As a result, expectations for rate cuts were pushed further out, with markets even assigning a small probability to a hike by year-end.

That repricing was clearly reflected in the Treasury market. Yields moved higher throughout the week, extending a multi-week selloff driven by inflation concerns tied to energy prices. By Friday, the 2-year note yield had risen 16 basis points on the week to 3.89%, while the 10-year note yield climbed 10 basis points to 4.39%.

Equities struggled under the weight of that shift. Growth and rate-sensitive sectors led the downside, with consumer discretionary (-2.7%), information technology (-1.9%), and communication services (-1.5%) all posting notable losses.

Real estate (-4.1%) and utilities (-5.0%) were among the worst performers as rising yields pressured valuation-sensitive areas of the market.

The energy sector stood out as the clear outperformer, gaining 2.8% for the week as crude oil climbed back toward the $100 per barrel mark. In contrast, consumer staples (-4.5%) and materials (-4.5%) lagged amid broader risk-off sentiment and commodity-related volatility.

Friday’s session captured the prevailing tone: oil prices moved higher again on escalating geopolitical developments, Treasury yields jumped, and equities sold off broadly. The S&P 500 narrowly held above the 6,500 level, but the continued break below its 200-day moving average reflects weakening technical momentum and deteriorating sentiment.

Ultimately, this week reinforced a critical shift in the market narrative. What began as an oil-driven inflation scare has evolved into a broader repricing of monetary policy expectations. As long as crude remains elevated and volatile, markets are likely to stay under pressure, with inflation fears and a “higher-for-longer”—or even “higher-again”—Fed outlook driving price action.

• S&P Mid Cap 400: -1.3% week-to-date
• Russell 2000: -1.7% week-to-date
• S&P 500: -1.9% week-to-date
• Nasdaq Composite: -2.1% week-to-date
• DJIA: -2.1% week-to-date

Oil shock reshapes the macro outlook

The stock market endured another volatile week as a surge in oil prices tied to the escalating conflict involving Iran dominated the macro backdrop.

The major averages finished lower across the board, with the S&P 500 declining 1.6%, the Nasdaq Composite falling 1.3%, and the Dow Jones Industrial Average losing 2.0%. T he S&P 500 also touched a new low for 2026 on Friday, while the Nasdaq Composite closed the week below its 200-day moving average (22,176.42), underscoring the pressure on growth-oriented stocks.

Smaller-cap stocks finished similarly, with the Russell 2000 declining 1.8% and the S&P Mid Cap 400 falling 2.0%.

The defining theme of the week was the market’s sensitivity to energy prices. Crude oil swung sharply throughout the week on headlines surrounding the conflict and disruptions in the Strait of Hormuz, ultimately finishing 5.5% higher. Each move higher in crude pressured equities as investors reassessed the inflation outlook and the Federal Reserve’s policy path. By the end of the week, futures markets were no longer confident the Fed would deliver even a single 25-basis point rate cut in 2025.

That shift in expectations was reflected in the Treasury market as well. Yields moved steadily higher during the week as investors priced in the inflationary implications of rising energy prices. By Friday’s close, the 2-year note yield had risen 17 basis points on the week to 3.73%, while the 10-year note yield climbed 16 basis points to 4.29%.

Sector performance largely mirrored the impact of higher oil prices. The energy sector was the only cyclical group to finish in positive territory, rising 2.1% for the week. Defensive areas also held up relatively well, with utilities gaining 0.4% and consumer staples slipping just 0.2%

Most other sectors struggled. Financials fell 3.4% amid rising yields and renewed pressure in private credit markets, while industrials declined 3.2% as transportation stocks were hit by rising fuel costs. Consumer discretionary dropped 3.0%, weighed down by weakness in travel-related names and homebuilders as higher yields pushed mortgage rates higher.

Technology held up somewhat better than the broader market but still finished lower. The information technology sector slipped 0.8% and communication services declined 1.2%. Under the surface, performance diverged. Semiconductor stocks showed resilience, while software names faced persistent selling pressure.

Mega-cap growth stocks also struggled. Several large technology names reversed earlier gains. Meta Platforms weighed on communication services after reports its next AI model would be delayed.

Economic data played a secondary role relative to the geopolitical developments. February CPI matched the Briefing. com consensus at both the headline and core levels, while the January PCE Price Index also met expectations with a 0.3% monthly increase. However, investors largely looked past the reports given that upcoming inflation readings will likely reflect the recent spike in energy prices. Meanwhile, the second estimate for fourth-quarter GDP was revised sharply lower to 0.7% from 1.4%, while the GDP price deflator was revised higher.

Ultimately, the week reinforced that markets are currently trading on energy prices. With crude oil volatile amid the conflict involving Iran and continued disruptions in the Strait of Hormuz, equities remain highly sensitive to geopolitical headlines that could alter the outlook for supply, inflation, and Federal Reserve policy.

• Nasdaq Composite: -1.3% week-to-date
• S&P 500: -1.6% week-to-date
• Russell 2000: -1.8% week-to-date
• DJIA: -2.0% week-to-date
• S&P Mid Cap 400: -2.0% week-to-date

Oil Shock and Iran Conflict Rattle Markets as Volatility Surges

Stocks endured a difficult week as a sharp surge in oil prices and escalating tensions between the U.S. and Iran weighed heavily on investor sentiment.

The S&P 500 declined 2.0% for the week, while the Nasdaq Composite fell 1.2% and the DJIA dropped 3.0%. Losses were even steeper across smaller companies, with the Russell 2000 falling 4.1% and the S&P Mid Cap 400 losing 4.6%, underscoring a clear risk-off tone across the market.

Geopolitical developments were the dominant driver of market action throughout the week. Conflict between the U.S., Israel, and Iran intensified following weekend strikes targeting senior Iranian leadership, triggering retaliatory attacks across the region and raising concerns about the security of global oil supply routes. Tanker traffic through the Strait of Hormuz slowed dramatically, and headlines throughout the week repeatedly moved markets as investors attempted to gauge the potential economic consequences. Crude oil prices ultimately surged $23.80 per barrel, or 35.5%, to $90.86, fueling fears that higher energy costs could ripple through transportation, input prices, and ultimately inflation.

The spike in oil prices created a difficult backdrop for equities. While the energy sector managed to finish the week higher (+1.0%), most other sectors struggled as investors assessed the implications for corporate margins and monetary policy. Materials (-7.2%), health care (-4.6%), industrials (-4.1%), and consumer staples (-4.9%) were among the hardest hit groups, while utilities (-2.1%) and real estate (-2.3%) also retreated. Financials (-1.8%) and consumer discretionary (-1.4%) posted more moderate declines but still faced pressure amid the broader risk-off environment.

Technology-related areas held up comparatively well, helping to limit losses in the major indices. The information technology sector slipped just 0.4% for the week. Strength across software names was a notable theme, amid continued buying interest in select enterprise software companies. Semiconductor stocks, however, faced significant pressure, as investors reduced exposure to cyclical growth areas during the week’s volatility.

Economic data releases added another layer of complexity to the market narrative.

Survey-based indicators early in the week showed continued expansion in both manufacturing and services activity, while the Federal Reserve’s Beige Book pointed to expectations for slight to moderate economic growth across most districts. However, Friday’s February employment report painted a more complicated picture. Nonfarm payrolls declined by 92,000 (Briefing.com consensus 60,000), while the unemployment rate ticked up to 4.4% from 4.3%. At the same time, average hourly earnings rose 0.4% (Briefing.com consensus 0.3%), highlighting persistent wage pressures. The combination of weakening job growth and firm wage inflation created a murky outlook for monetary policy, particularly against the backdrop of sharply rising energy prices.

Market volatility surged as the week progressed, reflecting the heightened uncertainty surrounding geopolitical developments and their potential economic fallout. The CBOE Volatility Index climbed 48.5% to 29.49, signaling a rapid increase in demand for downside protection. Meanwhile, sectors sensitive to higher fuel costs, including airlines, trucking, and cruise operators, experienced notable weakness as investors priced in the potential impact of sustained energy inflation.

Ultimately, the week illustrated how quickly geopolitical shocks can ripple through financial markets. The surge in oil prices and uncertainty surrounding the Iran conflict overshadowed otherwise solid economic readings earlier in the week, prompting broad selling pressure and a decisive shift toward defensive positioning. With inflation data due in the coming week and the energy shock unlikely to be reflected in those figures yet, investors will remain focused on geopolitical developments and oil prices as key drivers of market sentiment in the near term.

• Nasdaq Composite: -1.2% week-to-date
• S&P 500: -2.0% week-to-date
• DJIA: -3.0% week-to-date
• Russell 2000: -4.1% week-to-date
• S&P Mid Cap 400: -4.6% week-to-date

NVIDIA’s Beat Fails to Calm AI Disruption Concerns

Stocks finished lower in a volatile week that underscored the market’s uneasy relationship with mega-cap leadership, AI disruption concerns, and a still-hawkish inflation backdrop.

The S&P 500 (-0.4%) slipped back below its 50-day moving average, while the Nasdaq Composite (-1.0%) and DJIA (-1.3%) also posted weekly losses. Small- and mid cap stocks did not provide shelter, with the Russell 2000 (-1.2%) and S&P Mid Cap 400 (-0.9%) finishing firmly lower.

The week began with a sharp “risk-off” tone tied to renewed tariff uncertainty and intensifying AI-disruption fears, particularly across software and financials. Early weakness in mega-cap technology and asset managers set the tone, and although dip-buying efforts midweek briefly restored technical footing, the rebound ultimately proved fragile.

AI disruption remained a dominant theme. Software stocks endured sharp swings throughout the week as investors grappled with automation headlines and evolving competitive dynamics. At the same time, semiconductor stocks struggled to provide consistent leadership.

A major inflection point came with earnings from NVIDIA. Despite delivering another stellar report highlighted by record data center revenue and strong guidance, the stock fell sharply and ended the week down 6.7%. The muted response reinforced lingering concerns about valuation and the sustainability of hyperscaler capital expenditures tied to the AI buildout. T hat hesitation spilled over into other chipmakers and weighed on the broader information technology sector (-2.2%).

Financials (-2.0%) were another area of notable weakness. Early-week pressure tied to AI-related uncertainty and private equity exposure resurfaced late in the week after a hotter-than-expected inflation print pushed out rate-cut expectations. The January Producer Price Index rose 0.5% (Briefing.com consensus 0.3%), while core PPI increased 0.8% (Briefing.com consensus 0.3%), reinforcing the notion that inflation pressures remain sticky at the wholesale level.

The data added to an already hawkish tilt and undercut enthusiasm for rate-sensitive areas such as capital markets and leveraged finance.

In contrast to tech and financials, defensive sectors stood out. Utilities (+2.9%), consumer staples (+2.7%), and health care (+2.1%) attracted steady rotational flows, while energy (+2.0%) benefitted from a rebound in crude prices. Oil experienced a volatile week amid escalating tensions between the U.S. and Iran, with late-week comments from President Trump keeping geopolitical risk in focus.

Overall, the week reflected a market still searching for durable leadership. Mega-cap technology failed to convert strong earnings into sustained upside momentum, AI disruption fears resurfaced across software and financials, and a firm PPI reading reinforced the Fed’s cautious stance. At the same time, defensive sectors and energy saw continued interest, highlighting an ongoing rotation away from concentrated growth leadership and toward a more selective, risk-aware positioning backdrop.

• S&P 500: -0.4%
• S&P Mid Cap 400: -0.9%
• Nasdaq Composite: -1.0%
• Russell 2000: -1.2%
• DJIA: -1.3%

Market Recap - Mega-cap rebound and macro crosscurrents lift stocks

Stocks finished higher in a holiday-shortened week, with the S&P 500 (+1.1%) and Nasdaq Composite (+1.5%) outpacing the DJIA (+0.3%).

Importantly, the S&P 500 closed above its 50-day moving average on Friday and the Nasdaq Composite snapped a five-week losing streak.

Mid- and small-cap stocks also participated, with the S&P Mid Cap 400 (+1.2%) and Russell 2000 (+0.7%) posting solid gains, highlighting broad-based buying amid ongoing rotation. Several mega-cap technology and communication services names, which had slipped in recent weeks following earnings-related weakness, garnered renewed buying interest, helping lift indexes and ETFs.

Corporate earnings and guidance remained central to market action, driving notable moves across multiple sectors and individual stocks throughout the week. Cyclical sectors including industrials (+1.7%), financials (+1.6%), and energy (+1.7%) contributed meaningfully to the advance, while defensives such as consumer staples (-2.3%) and health care (-0.6%) underperformed, giving back some of their strong gains from previous weeks.

Economic releases underscored a mixed backdrop. Advance fourth-quarter GDP came in at 1.4% versus the Briefing.com consensus of 3.0% (prior 4.4%), while the Q4 Chain Deflator was 3.6% (Briefing.com consensus 3.3%; prior 3.8%), confirming that inflation remains above the Fed’s comfort level even as growth slows. December personal income rose 0.3% (Briefing. com consensus 0.3%; prior revised 0.4%), and personal spending increased 0.4% (Briefing.com consensus 0.2%; prior revised 0.4%), while the December PCE Price Index came in at 0.4% (Briefing.com consensus 0.3%; prior 0.2%), with the core reading also 0.4% (Briefing. com consensus 0.4%; prior 0.2%). The data collectively suggested that the economy continues to expand at a moderate pace, but elevated inflation keeps near-term rate-cut expectations in check.

Geopolitical and policy developments added further complexity.

Oil experienced a volatile week amid escalating tensions between the U.S. and Iran, while Friday’s Supreme Court ruling on tariffs briefly unsettled trade-sensitive sectors and contributed to short-term market swings. These events, together with earnings-driven moves, created a dynamic week of headline-driven rotation across sectors and individual names.

Overall, the market demonstrated resilience, with mega-cap technology and communication services seeing a technical rebound, mid- and small-cap stocks participating broadly, and cyclical sectors contributing to gains. Defensive areas lagged, reflecting selective positioning amid a mix of macro, policy, and geopolitical developments, setting the stage for continued focus on earnings, inflation, and international risks in the weeks ahead.

• Nasdaq Composite: +1.5% week-to-date
• S&P Mid Cap 400: +1.2% week-to-date
• S&P 500: +1.1% week-to-date
• Russell 2000: +0.7% week-to-date
• DJIA: +0.3% week-to-date

Market Recap - Mega-cap weakness and AI disruption fears outweigh rotational strength

Stocks started the week on a mostly positive note but ended with the major averages posting weekly losses amid persistent pressure on mega-cap and tech names.

The S&P 500 (-1.4%) and Nasdaq Composite (-2.1%) lagged, while the DJIA (-1.2%) also retreated. Strength in the broader market saw the S&P 500 Equal Weighted Index (+1.0%) handily outperform the major averages. Smaller-cap indexes also outperformed, with the Russell 2000 (-0.9%) and S&P Mid Cap 400 (-0.7%) showing relative resilience, reflecting broader participation beyond mega-cap leadership.

T he week was defined by a familiar tug-of-war: AI disruption fears and software weakness weighed on the information technology sector and other mega-cap tech names, while defensive sectors and smaller cyclical components showed pockets of strength. Mega-cap names like Microsoft, NVIDIA, Apple, and Amazon faced repeated pressure, though select software and chip names rebounded midweek. Conversely, the utilities (+7.1%), real estate (+3.9%), and energy (+1.7%) sectors led sector gains, highlighting a defensive rotation amid uncertainty.

Economic data provided mixed signals for monetary policy. The January jobs report was encouraging, with payrolls rising 130K and moderate wage growth, suggesting continued strength in the labor market. At the same time, January CPI showed cooler-than-expected inflation at 0.2% headline and 0.3% core, signaling some disinflation. Together, these reports largely canceled each other out at the margin, keeping rate-cut expectations for later this year in check.

Overall, the market is navigating a split environment: mega-cap tech remains under pressure, AI concerns persist, but defensive sectors, smaller-cap stocks, and cyclical pockets continue to attract rotation.

• S&P Mid Cap 400: -0.7% week-to-date

• Russell 2000: -0.9% week-to-date

• DJIA: -1.2% week-to-date

• S&P 500: -1.4% week-to-date

• Nasdaq Composite: -2.1% week-to-date