# MARKET SUMMARY REPORT
Session: Pre-Market | Date: February 14, 2026
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Market Summary
U.S. equity markets closed mixed on Friday in choppy trading, with persistent weakness in mega-cap technology stocks offsetting broad-based strength across the market. The S&P 500 gained 3.41 points (+0.05%) to close at 6,836.16, while the Nasdaq Composite fell 50.48 points (-0.22%) to 22,546.69. The Dow Jones Industrial Average edged up 48.95 points (+0.10%) to 49,499.72. Despite Friday’s resilience at the index level, all three major averages posted weekly losses exceeding 1.0%, with the Nasdaq leading declines at -2.1% for the week.
The session highlighted an intensifying market bifurcation, with the S&P 500 Equal Weighted Index surging 1.0% while the market-cap-weighted S&P 500 barely held positive territory. The Vanguard Mega Cap Growth ETF declined 0.6% as heavyweights including NVIDIA (-2.23% to $182.78), Apple (-2.27% to $255.78), Meta Platforms (-1.55% to $639.77), and Alphabet (-1.08% to $306.02) came under renewed pressure. Small and mid-cap indices significantly outperformed, with the Russell 2000 climbing 1.2% and the S&P Mid Cap 400 gaining 0.8%. Year-to-date performance reveals a stark divergence: the S&P Mid Cap 400 leads at +7.8%, the Russell 2000 at +6.6%, the DJIA at +3.0%, while the S&P 500 sits at -0.1% and the Nasdaq trails at -3.0%.
Market breadth was overwhelmingly positive despite the mixed index performance. The NYSE recorded 1,999 advancing issues versus 732 decliners on volume of 1.33 billion shares, while the Nasdaq posted 3,129 gainers against 1,646 losers on 8.03 billion shares. A solid January CPI report provided a supportive backdrop, showing headline inflation of 0.2% month-over-month (below the 0.3% consensus) and a deceleration in the year-over-year rate to 2.4% from 2.7%. Core CPI matched expectations at 0.3% monthly, with the annual rate declining to 2.5% from 2.6%. This cooler inflation data sent Treasury yields to multi-month lows and reinforced expectations for potential Fed rate cuts later in the year.
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Market Snapshot
Major Indices (Friday Close):
Weekly Performance:
Year-to-Date Performance:
Market Breadth:
Sentiment Indicators (WaveFinder):
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Sector Performance
Friday’s S&P 500 Sector Rankings (Best to Worst):
1. Utilities: +2.7% (ATR 4.12%, P100) – All 31 components finished higher as defensive rotation accelerated amid tech weakness
2. Real Estate: +1.5% (ATR 1.04%, P68) – Rate-sensitive sector rallied on cooler CPI data; top performer for the week
3. Materials: +1.1% (ATR 2.05%, P26) – Rebounded from Thursday’s sharp decline alongside rising commodity prices
4. Health Care: +1.0% (ATR -0.81%, P11) – Broad-based gains in defensive positioning
5. Industrials: +0.8% (ATR 1.78%, P16) – Cyclical strength returned after previous session weakness
6. Energy: +0.8% (ATR 3.29%, P79) – Supported by stabilizing crude oil prices
7. Consumer Staples: +0.2% (ATR 2.46%, P84) – Modest defensive positioning
8. Consumer Discretionary: -0.1% (ATR 0.43%, P26) – Weighed down by Amazon (-0.41% to $198.79)
9. Financials: -0.4% (ATR 1.12%, P53) – Insurance names pressured on AI application concerns
10. Information Technology: -0.5% (ATR -1.49%, P21) – Volatile session with mega-cap pressure overwhelming sector gains
11. Communication Services: -0.8% (ATR -1.50%, P11) – Largest daily loss as Meta and Alphabet declined
Weekly Sector Leaders:
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Key Earnings & Movers
Top Performers:
Software Sector Relief:
Notable Decliners:
Sector-Specific Pressure:
Semiconductor Sector:
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Stock Spotlight: Expedia Group (EXPE)
Expedia Group is declining despite delivering a solid Q4 beat that showcased its strongest growth in over two years. Revenue climbed 11.4% year-over-year to $3.55 billion, exceeding expectations, while Q1 revenue guidance of $3.32-$3.37 billion came in above consensus. The full-year FY26 revenue midpoint of $15.6-$16.0 billion also modestly topped estimates. The company’s fundamental performance metrics demonstrated broad-based strength: booked room nights increased 9% year-over-year, gross bookings jumped 11%, and B2B bookings surged 24% to $8.7 billion with double-digit growth across all regions. Advertising revenue accelerated 19% as the company expanded its Carrot Ads platform to over 9,000 active advertisers.
The market’s cautious reaction appears driven by the deceleration in FY26 bookings guidance of 6-8% growth versus Q4’s 11% pace, with management citing macro uncertainty and softness in Asia-related travel corridors as justification for the conservative low-end estimate. Additionally, adjusted EBITDA margin expansion guidance of 100-125 basis points, while positive, suggests measured reinvestment rather than aggressive scaling. Management addressed AI search risk head-on, noting no material traffic impact yet from Google’s AI travel features, but acknowledged that GenAI integrations could reshape traveler discovery over time. This represents an overhang on the stock despite near-term stability. The reaction underscores how high expectations had become—solid execution and healthy consumer demand are not enough when guidance reads more steady-state than accelerating in an environment where growth visibility commands premium valuations.
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Bond Market & Treasuries
U.S. Treasury markets posted a strong finish to the week, with yields falling across the curve to reach multi-month lows following the cooler-than-expected January CPI report. The benchmark 10-year Treasury note yield declined 5 basis points to 4.06%, marking its lowest closing level since early December and a 15-basis-point weekly decline. The 2-year note yield fell 6 basis points to 3.41%, settling at its lowest level since September 2022, though it remained above its 2025 intraday low of 3.378% reached on October 17. The 2-year yield dropped 9 basis points for the week.
Yields across the intermediate curve also reached significant levels: the 3-year note declined 6 basis points to 3.45% (down 12 bps for the week), while the 5-year note fell 6 basis points to 3.61% (down 15 bps weekly), its lowest close since early December. The 30-year bond yield decreased 3 basis points to 4.70%, declining 16 basis points for the week. The Treasury rally accelerated following the 8:30 AM ET release of January CPI data showing 0.2% monthly headline inflation versus the 0.3% consensus. The bond market interpreted the disinflation trend—with year-over-year headline CPI decelerating to 2.4% from 2.7% and core CPI easing to 2.5% from 2.6%—as providing room for potential Federal Reserve rate cuts later in 2026, even as GDP growth runs above potential.
Bond and equity markets will be closed Monday for Presidents Day, with trading resuming Tuesday ahead of a data-heavy week including advance Q4 GDP (consensus 3.0% vs. prior 4.3%) on Thursday and January FOMC minutes on Wednesday.
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Commodities
Energy:
Precious Metals:
Industrial Metals:
Market Impact:
Energy and materials sectors both posted gains of approximately 0.8% and 1.1% respectively on Friday, supported by commodity price stability. The precious metals rally provided particular support to gold miners and materials companies. Week-to-date, energy sector gained 1.7% despite crude oil’s modest decline, suggesting positioning ahead of potential supply adjustments.
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Overseas Markets
Asia:
China’s January financial data showed mixed results with new loans reaching CNY 4.71 trillion (below the expected CNY 5.00 trillion), while total social financing hit CNY 7.22 trillion (above the CNY 7.05 trillion estimate). Outstanding loan growth decelerated to 6.1% year-over-year from 6.4%, and January house prices declined 3.1% year-over-year versus -2.7% previously, indicating continued property sector weakness. South Korea reported January import prices down 1.2% year-over-year with export prices up 7.8%, while New Zealand’s Business PMI moderated to 55.2 from 56.1, with Q1 inflation expectations rising to 2.4% from 2.3%.
Europe:
The Eurozone reported Q4 GDP growth of 0.3% quarter-over-quarter (1.3% year-over-year), matching expectations, with employment increasing 0.2% quarterly and 0.7% annually, exceeding forecasts. The December trade surplus widened to €12.6 billion from €9.3 billion. Germany’s January wholesale price index jumped 0.9% month-over-month (versus 0.1% expected), while Spain’s January CPI rose 2.3% year-over-year (slightly below the 2.4% estimate). Switzerland’s January CPI came in flat at 0.1% year-over-year.
Policy Developments:
An adviser to Japan’s Prime Minister indicated the Bank of Japan may skip a rate hike in March but is likely to raise rates later in 2026. European Central Bank officials offered mixed commentary, with policymaker Kazaks stating the ECB is “in a good position regarding rates,” while Nagel warned that geopolitical rivalries could generate higher inflation. The U.S. and Taiwan formalized a trade agreement during the week.
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Economic Data
January Consumer Price Index (Released Friday, 8:30 AM ET):
Key Takeaway: The report showed encouraging disinflation on a year-over-year basis, which markets perceive as providing the Federal Reserve room to consider additional rate cuts in 2026 even with GDP growth running above potential. However, specific categories showed pressure: airfares jumped 6.5% month-over-month, breakfast cereal rose 2.1%, and fresh fish/seafood increased 3.6%.
January Employment Situation (Released Wednesday):
Concerning Details: The 130,000 payroll gain was driven predominantly by health care and social assistance (+123,