Month: February 2026

What I’m Watching This Week – 23 February 2026

Published on by dredheadzLeave a comment

The Markets (as of market close February 20, 2026)

U.S. equities spent most of last week trending lower, ultimately rebounding in a major way last Friday to close the week higher. Investors were in a “risk-off” mode as inflation rose while economic growth slowed notably. However, Wall Street reacted favorably to Friday’s Supreme Court ruling against President Trump’s tariffs. The S&P 500 surged to a one-week high, closing above 6,900, while the Dow pushed past 49,600. The tech-heavy NASDAQ snapped a five-week losing streak. Several market sectors gained more than 2.0% for the week, including industrials, communication services, and utilities. Consumer staples was the only market sector to end last week lower. Last week also proved to be dynamic for fixed income, with Treasury yields breaking their recent downtrends and moving slightly higher as investors had to digest the Supreme Court ruling, sluggish economic data, and geopolitical tensions.

Stock Market Indexes

Market/Index2025 ClosePrior WeekAs of 2/20Weekly ChangeYTD Change
DJIA48,063.2949,500.9349,625.970.25%3.25%
NASDAQ23,241.9922,546.6722,886.071.51%-1.53%
S&P 5006,845.506,836.176,909.511.07%0.94%
Russell 20002,481.912,646.702,663.780.65%7.33%
Global Dow6,169.346,596.066,611.350.23%7.16%
fed. funds target rate3.50%-3.75%3.50%-3.75%3.50%-3.75%0 bps0 bps
10-year Treasuries4.16%4.06%4.08%2 bps-8 bps
US Dollar-DXY98.2696.8597.720.90%-0.55%
Crude Oil-CL=F$57.46$62.80$66.395.72%15.54%
Gold-GC=F$4,323.90$5,053.60$5,121.701.35%18.45%

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Economic News

  • The initial estimate of gross domestic product for the fourth quarter of 2025 showed the economy expanded at an annualized rate of 1.4%, which was below the third-quarter growth rate of 4.4%. Personal consumption expenditures (consumer spending) rose 2.4% in the fourth quarter compared to a 3.5% increase in the third quarter. The drop in consumer spending was largely attributable to a decrease in goods, which declined from an increase of 3.0% in the third quarter to a decrease of 0.1% in the fourth quarter. Consumer spending on services dipped 0.2 percentage point to 3.4%. Government spending, exports, and imports also contracted in the fourth quarter, with the decline in goods imports likely attributable to tariffs.
  • According to the latest report from the Bureau of Economic Analysis, both personal income and disposable (after-tax) personal income rose 0.3% in December 2025. Consumer spending, as measured by personal consumption expenditures, increased 0.4%. Consumer prices rose 0.4% from November 2025. Prices excluding food and energy also advanced 0.4% in December. Since December 2024, consumer prices have risen 2.9%. Prices excluding food and energy rose 3.0% over the same 12-month period.
  • The latest information on the international trade in goods and services trade deficit, released February 19, was for December and showed the deficit grew 32.6%, or $17.3 billion, to $70.3 billion. The trade deficit had been volatile throughout 2025, largely due to shifting tariff announcements from the White House. December exports were $287.3 billion, $5.0 billion, or 1.7%, less than November exports. December imports were $357.6 billion, $12.3 billion, or 3.6%, more than November imports. For 2025, the goods and services deficit decreased $2.1 billion, or 0.2%, from 2024. Exports increased $199.8 billion, or 6.2%. Imports increased $197.8 billion, or 4.8%.
  • The international trade in goods deficit expanded by $15.8 billion to $98.5 billion in December. Exports of goods for December were $180.0 billion, $5.6 billion, or 3.0%, less than November exports. Imports of goods for December were $278.6 billion, $10.2 billion, or 3.8%, more than November imports.
  • According to the latest information from the Census Bureau, the number of residential building permits issued in December was 4.3% above the November rate but 2.2% below the December 2024 estimate. Permits for single-family homes in December were 1.7% below the prior month’s rate. The number of housing starts was 6.2% above the November estimate but 7.3% under the rate from a year earlier. Housing completions in December were 2.3% above the revised November estimate but 0.1% below the December 2024 rate. Single-family housing completions in December were 0.1% below the November rate.
  • Sales of new single-family houses in December 2025 were 1.7% below the November 2025 rate but 3.8% above the December 2024 estimate. The estimated number of new homes sold in 2025 was 1.1% below the 2024 figure. The number of new homes for sale in December represented a supply of 7.6 months at the current sales rate, which was 1.3% below the November 2025 estimate and 7.3% under the December 2024 estimate. The median sales price of new houses sold in December 2025 was $414,400. This was 4.2% above the November 2025 price of $397,600 but 2.0% below the December 2024 price of $423,000. The average sales price of new houses sold in December 2025 was $532,600. This was 0.5% above the November 2025 price of $530,200 and 4.7% higher than the December 2024 price of $508,900.
  • New orders for durable goods declined 1.4% in December from the previous month’s estimate but were 7.8% above the December 2024 rate. New orders, excluding transportation, ticked up 0.9% in December. Excluding defense, new orders fell 2.5% in December.
  • Industrial production increased 0.7% in January after moving up 0.2% in December. In January, manufacturing output advanced 0.6%, mining decreased 0.2%, while utilities moved up 2.1%. Since January 2025, industrial production has grown 2.3%, manufacturing increased 2.4%, mining rose 2.5%, and utilities advanced 1.1%.
  • For the week ended February 14, there were 206,000 new claims for unemployment insurance, a decrease of 23,000 from the previous week’s level, which was revised up by 2,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended February 7 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended February 7 was 1,869,000, an increase of 17,000 from the previous week’s level, which was revised down by 10,000. States and territories with the highest insured unemployment rates for the week ended January 31 were Rhode Island (3.0%), New Jersey (2.9%), Massachusetts (2.7%), Minnesota (2.6%), Washington (2.6%), Illinois (2.2%), Montana (2.2%), New York (2.2%), California (2.1%), and Pennsylvania (2.1%). The largest increases in initial claims for unemployment insurance for the week ended February 7 were in Texas (+2,592), Virginia (+1,909), California (+1,362), Tennessee (+924), and Kentucky (+838), while the largest decreases were in Pennsylvania (-3,181), Missouri (-2,755), Illinois (-2,371), Wisconsin (-1,946), and Michigan (-1,771).
  • The national average retail price for regular gasoline was $2.924 per gallon on February 16, $0.022 per gallon above the prior week’s price but $0.224 per gallon less than a year ago. Also, as of February 16, the East Coast price increased $0.011 to $2.833 per gallon; the Midwest price decreased $0.005 to $2.683 per gallon; the Gulf Coast price rose $0.006 to $2.482 per gallon; the Rocky Mountain price climbed $0.068 to $2.737 per gallon; and the West Coast price increased $0.107 to $4.045 per gallon.

Eye on the Week Ahead

The January data on durable goods orders is out this week, along with the advance report on international trade in goods. The end of the week brings with it the release of the Producer Price Index for January. December saw producer prices increase by 0.5%, while prices rose 3.0% over the last 12 months.

What I’m Watching This Week – 17 February 2026

Published on by dredheadzLeave a comment

The Markets (as of market close February 13, 2026)

Investors experienced another turbulent week for U.S. stocks last week, although a fairly mild inflation report brought the market some relief on Friday (see below). The S&P 500 had it’s worst week since November, and the Global Dow was the only major market index that didn’t end up in the red. Fears about AI disruption spread to more industries seen as potentially vulnerable. Investors fled to defensive sectors such as utilities, materials, and real estate, which all posted strong weekly gains, leaving the financial services, communication services, and information technology sectors with sharp losses. Safe haven seekers pushed the yield on 10-year Treasuries, which falls when prices rise, down to its lowest level since November 28.

Stock Market Indexes

Market/Index2025 ClosePrior WeekAs of 2/13Weekly ChangeYTD Change
DJIA48,063.2950,115.6749,500.93-1.23%2.99%
NASDAQ23,241.9923,031.2122,546.67-2.10%-2.99%
S&P 5006,845.506,932.306,836.17-1.39%-0.14%
Russell 20002,481.912,670.342,646.70-0.89%6.64%
Global Dow6,169.346,547.786,596.060.74%6.92%
fed. funds target rate3.50%-3.75%3.50%-3.75%3.50%-3.75%0 bps0 bps
10-year Treasuries4.16%4.20%4.06%-14 bps-10 bps
US Dollar-DXY98.2697.6196.85-0.78%-1.43%
Crude Oil-CL=F$57.46$63.52$62.80-1.13%9.29%
Gold-GC=F$4,323.90$4,974.00$5,053.601.60%16.88%

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Economic News

  • Total employment rose by 130,000 in January. Job gains occurred in health care, social assistance, and construction, while federal government and financial activities lost jobs. Employment changed little in 2025 (+15,000 per month on average). The unemployment rate, at 4.3%, ticked down by 0.1 percentage point from December, and the number of unemployed people, at 7.4 million, decreased by 141,000. These measures are higher than a year earlier, when the jobless rate was 4.0%, and the number of unemployed people was 6.9 million. Last month, the labor force participation rate and the employment-population ratio each rose 0.1 percentage point to 62.5% and 59.8%, respectively. The number of long-term unemployed (those jobless for 27 weeks or more), at 1.8 million, changed little in January but was up by 386,000 from a year earlier. The long-term unemployed accounted for 25.0% of all unemployed people in January. The change in total employment for November was revised down by 15,000, and the change for December was revised down by 2,000. With these revisions, employment in November and December combined was 17,000 lower than previously reported. In January, average hourly earnings rose by $0.15, or 0.4%, to $37.17. Over the past 12 months, average hourly earnings have increased by 3.7%. The average workweek edged up by 0.1 hour to 34.3 hours in January.
  • The Consumer Price Index advanced 0.2% in January and 2.4% for the year, a significant slowdown from the 2.7% advance for the 12 months ended in December. Declining prices for gasoline (-7.5%) and used cars (-2.0%) helped bring down the overall inflation rate for the year. Prices less food and energy increased 0.3% in January and 2.5% since January 2025. Shelter prices cooled in January, rising 0.2% after a 0.4% rise in December. In January, food prices rose 0.2%, while energy prices fell 1.5%. Over the last 12 months, prices for food increased 2.9%, while energy prices decreased 0.1%.
  • Sales at the wholesale level were virtually unchanged in December from the previous month. However, retail sales increased 2.4% from December 2024. Total sales for the 12 months of 2025 were up 3.7% from 2024. Retail trade sales were virtually unchanged in December from November 2025 but were up 2.1% from last year. Nonstore (online) retailer sales were up 5.3% from last year, while sales at food service and drinking places were up 4.7% from December 2024.
  • Import prices ticked up 0.1% in December, while export prices advanced 0.3%. Over the past year, import prices were unchanged and export prices increased 3.1%.
  • Sales of existing homes fell 8.4% in January, according to the latest report from the National Association of Realtors®. Since January 2025, existing home sales are down 4.4%. The decrease in sales last month may be attributable, at least in part, to below-normal temperatures and above-normal precipitation in January. Available inventory, at a 3.7-month supply, changed little in January from December. The median existing home sales price was $396,800, down from December’s estimate of $405,100 but above the January 2025 price of $393,400. Sales of existing single-family homes decreased 9.0% in January and 4.3% from a year earlier. The median single-family existing home sales price last month was $400,300, less than the December price of $409,500 but higher than the January 2025 estimate of $398,100.
  • The monthly federal government deficit was $95 billion in January, roughly $50 billion less than the December deficit and about $34 billion less than the January 2025 deficit. Through the first four months of the fiscal year, the deficit sits at $697 billion, $143 billion under the deficit over the same period of the prior fiscal year. In January, the largest sources of revenue included individual income taxes ($317 billion) and social insurance and retirement ($170 billion). The largest outlays were for Medicare ($149 billion) and Social Security ($138 billion).
  • For the week ended February 7, there were 227,000 new claims for unemployment insurance, a decrease of 5,000 from the previous week’s level, which was revised up by 1,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended January 31 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended January 31 was 1,862,000, an increase of 21,000 from the previous week’s level, which was revised down by 3,000. States and territories with the highest insured unemployment rates for the week ended January 24 were Rhode Island (2.9%), New Jersey (2.8%), Massachusetts (2.7%), Minnesota (2.6%), Washington (2.6%), California (2.3%), Illinois (2.2%), Montana (2.2%), New York (2.1%), Connecticut (2.0%), Michigan (2.0%), and Oregon (2.0%). The largest increases in initial claims for unemployment insurance for the week ended January 31 were in Pennsylvania (+5,268), New York (+3,141), Missouri (+2,833), New Jersey (+2,602), and Illinois (+2,203), while the largest decreases were in Nebraska (-2,146), Virginia (-980), Oklahoma (-679), Iowa (-644), and Texas (-517).
  • The national average retail price for regular gasoline was $2.902 per gallon on February 9, $0.035 per gallon above the prior week’s price but $0.226 per gallon less than a year ago. Also, as of February 9, the East Coast price was unchanged at $2.822 per gallon; the Midwest price increased $0.038 to $2.688 per gallon; the Gulf Coast price rose $0.032 to $2.476 per gallon; the Rocky Mountain price climbed $0.100 to $2.669 per gallon; and the West Coast price increased $0.111 to $3.938 per gallon.

Eye on the Week Ahead

The release of economic reports remains somewhat tenuous and unpredictable, as agencies continue to play catch-up following the October government shutdown. In any case, the first report on fourth-quarter gross domestic product is on tap for release this week. The economy expanded at a 4.4% annualized rate in the third quarter.

What I’m Watching This Week – 9 February2026

Published on by dredheadz


The Markets (as of market close February 6, 2026)

Last week was defined by volatility as stocks whipsawed between deep, tech-led losses and a late-week rally. Wall Street experienced a mid-week selloff as investors moved away from tech and AI shares. Investors were also concerned about a drop in job openings (see below) and a rise in jobless claims (see below). A surge last Friday pared losses and even helped push the Dow past the 50,000 mark. U.S. bond markets saw prices edge slightly higher, pulling yields lower. The market sectors experienced extreme differences, with consumer staples, industrials, and energy surging, while consumer discretionary, information technology, and communication services closed sharply in the red.

Stock Market Indexes

Market/Index2025 ClosePrior WeekAs of 2/6Weekly ChangeYTD Change
DJIA48,063.2948,892.4750,115.672.50%4.27%
NASDAQ23,241.9923,461.8223,031.21-1.84%-0.91%
S&P 5006,845.506,939.036,932.30-0.10%1.27%
Russell 20002,481.912,626.552,670.341.67%7.59%
Global Dow6,169.346,421.406,547.781.97%6.13%
fed. funds target rate3.50%-3.75%3.50%-3.75%3.50%-3.75%0 bps0 bps
10-year Treasuries4.16%4.24%4.20%-4 bps4 bps
US Dollar-DXY98.2697.1197.610.51%-0.66%
Crude Oil-CL=F$57.46$65.55$63.52-3.10%10.55%
Gold-GC=F$4,323.90$5,067.50$4,974.00-1.85%15.04%

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Economic News

  • According to the latest Job Openings and Labor Turnover Summary, the number of job openings declined 386,000 to 6.5 million in December and was down 966,000 from the end of 2024. The number of hires, at 5.3 million, rose by 172,000. Total separations include quits (voluntary separations), layoffs and discharges, and other separations. In December, the number of total separations increased by 107,000 to 5.3 million. In November, the number of job openings was revised down by 218,000 to 6.9 million, the number of hires was revised up by 6,000 to 5.1 million, and the number of total separations was revised up by 64,000 to 5.1 million. Within separations, the number of quits was revised up by 32,000 to 3.2 million, the number of layoffs and discharges was revised up by 14,000 to 1.7 million, and the number of other separations was revised up by 17,000 to 249,000.
  • The S&P Global US Manufacturing Purchasing Managers’ Index™ recorded 52.4 in January, up from 51.8 in December. The January reading signaled a stronger rate of expansion in the manufacturing sector. While new orders grew modestly, January’s growth was in part driven by inventory building over the past several months. Tariffs remained a notable issue, driving up input costs and limiting demand gains, especially from international markets.
  • The S&P Global US Services PMI® Business Activity Index ticked up to 52.7 in January, up from 52.5 in December. The index signaled continuous service sector expansion for three years; however, January’s growth was historically weak. Nevertheless, the January rise in business activity in the services sector was supported by stronger expansion in work orders. Despite the uptick, providers noted the steepest reduction in foreign demand in over three years, linked to tariffs and political uncertainty.
  • For the week ended January 31, there were 231,000 new claims for unemployment insurance, an increase of 22,000 from the previous week’s level. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended January 24 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended January 24 was 1,844,000, an increase of 25,000 from the previous week’s level, which was revised down by 8,000. States and territories with the highest insured unemployment rates for the week ended January 17 were New Jersey (2.8%), Rhode Island (2.8%), Massachusetts (2.7%), Minnesota (2.5%), Washington (2.5%), Michigan (2.2%), Montana (2.2%), California (2.1%), Illinois (2.1%), and Puerto Rico (2.1%). The largest increases in initial claims for unemployment insurance for the week ended January 24 were in Nebraska (+2,074), New York (+1,739), Oklahoma (+938), Virginia (+768), and Iowa (+522), while the largest decreases were in California (-12,531), Michigan (-8,197), Kentucky (-3,879), Texas (-2,187), and South Carolina (-2,095).
  • The national average retail price for regular gasoline was $2.867 per gallon on February 2, $0.014 per gallon above the prior week’s price but $0.215 per gallon less than a year ago. Also, as of February 2, the East Coast price increased $0.021 to $2.822 per gallon; the Midwest price decreased $0.043 to $2.650 per gallon; the Gulf Coast price fell $0.011 to $2.444 per gallon; the Rocky Mountain price climbed $0.033 to $2.569 per gallon; and the West Coast price rose $0.122 to $3.827 per gallon.

Eye on the Week Ahead

The latest data on inflation is available this week, with the release of both the Consumer Price Index (CPI) and the report on retail sales. The CPI rose 2.7% in 2025, while prices excluding the more volatile food and energy categories increased 2.6%.

Monthly Market Review – January 2026

Published on by dredheadz

The Markets (as of market close January 30, 2026)

The U.S. stock market delivered a strong performance to kick off 2026. Market indexes reached record-setting levels. Overall, Wall Street showed resilience despite mixed corporate results and ongoing fiscal policy uncertainty. Each of the benchmark indexes listed here closed January in the black. The S&P 500 rose steadily throughout the month, even surpassing the 7,000 threshold for the first time in its history. The Dow’s gains reflected broad market strength, while the tech-heavy NASDAQ showed consistent upward momentum throughout the month. Entering February, investor sentiment remained cautiously optimistic.

January was a pivotal month for the U.S. economy, revealing both the strengths and vulnerabilities. The combination of fiscal stimulus, resilient corporate earnings, and technological innovation provided avenues for growth, but the headwinds from tariffs, a cooling labor market, and persistent inflation signaled a more challenging road ahead. The economy appears to be transitioning from stimulus-fueled expansion to a period of more modest, uneven growth. Gross domestic product ended the third quarter of 2025 with an annualized return of 4.4%. Forecasts suggest the fourth quarter GDP may tick down a bit.

Price pressures are moderating but remain above the Federal Reserve’s 2.0% target, impacted by tariffs, both threatened and realized, and overall fiscal policy uncertainty.

The labor market continued to show signs of strain. Job growth slowed considerably, while the unemployment rate increased from 4.1% in December 2024 to 4.4% in December 2025.

Late in January, the Federal Reserve held interest rates steady, reinforcing expectations for a stable policy path, with possibly one or two rate cuts later in the year. Among the market sectors, energy, materials, consumer staples, industrials, and communication services advanced, marking a shift away from tech shares.

About one-third of the way through fourth-quarter earnings season, the S&P 500 is reporting strong results according to the latest information from FactSet. Overall, 33.0% of the S&P 500 companies have reported actual earnings results for the fourth quarter. Of those companies, 75.0% reported actual earnings per share (EPS) above estimates, which is below the five-year average of 78% and below the 10-year average of 76.0%. Eight of the 11 sectors are reporting year-over-year growth, led by information technology, industrials, and communication services.

Ten-year Treasury yields climbed throughout January, reaching a multi-month high early in the month. The rise in yields was largely driven by a selloff of Treasury bonds, reflecting investor concerns about persistent inflation, a slowing labor market, and the perception that the Fed may need to reduce the number of interest rate cuts in 2026. Two-year Treasuries rose about 4.5 basis points in January.

Crude oil prices were on track for the first monthly increase in four months. Severe winter weather disrupted U.S. crude production, while supply concerns pushed prices sharply higher. The dollar hovered near four-year lows, making oil cheaper for foreign buyers and boosting demand. The retail price of regular gasoline was $2.853 per gallon on January 26, $0.012 above the price a month earlier but $0.250 lower than the price a year ago.

Stock Market Indexes

Market/Index2025 ClosePrior MonthAs of 1/30Monthly ChangeYTD Change
DJIA48,063.2948,063.2948,892.471.73%1.73%
NASDAQ23,241.9923,241.9923,461.820.95%0.95%
S&P 5006,845.506,845.506,939.031.37%1.37%
Russell 20002,481.912,481.912,626.555.83%5.83%
Global Dow6,169.346,169.346,421.404.09%4.09%
fed. funds target rate3.50%-3.75%3.50%-3.75%3.50%-3.75%0 bps0 bps
10-year Treasuries4.16%4.16%4.24%8 bps8 bps
US Dollar-DXY98.2698.2697.11-1.17%-1.17%
Crude Oil-CL=F$57.46$57.46$65.5514.08%14.08%
Gold-GC=F$4,323.90$4,323.90$5,067.5017.20%17.20%

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark the performance of specific investments.

Latest Economic Reports

The following section contains a review of the latest economic data available as of January 30, 2026.

  • Employment: Job growth was little changed in December, with the addition of 50,000 new jobs and has shown little change since April. The change in employment for October was revised down by 68,000, from -105,000 to -173,000, and the change for November was revised down by 8,000, from +64,000 to +56,000. With these revisions, employment in October and November combined was 76,000 lower than previously reported. The unemployment rate was 4.4% in December, 0.1 percentage point lower than the previous rate but 0.3 percentage point above the December 2024 estimate. The number of unemployed persons in December, at 7.5 million, edged down 278,000 from November but was 583,000 above the December 2024 estimate. The number of long-term unemployed (those jobless for 27 weeks or more) was essentially unchanged at 1.9 million from November and accounted for 26.0% of all unemployed persons. The total number of long-term unemployed in December was 397,000 above the estimate from a year earlier. The labor force participation rate inched down 0.1 percentage point to 62.4% in December from November and was 0.1 percentage point below the rate from December 2024. The employment-population ratio in December, at 59.7%, increased 0.1 percentage point from November and 0.2 percentage point from December 2024 (59.9%). In December, average hourly earnings increased by $0.12, or 0.3%, to $37.02. Over the past 12 months ended in December, average hourly earnings rose by 3.8%. The average workweek decreased by 0.1 hour to 34.2 hours in December.
  • There were 209,000 initial claims for unemployment insurance for the week ended January 24, 2026. During the same period, the total number of workers receiving unemployment insurance was 1,827,000. The insured unemployment rate was 1.2%, the same rate as a year earlier. There were 210,000 initial claims a year ago, while the total number of workers receiving unemployment insurance was 1,849,000.
  • FOMC/interest rates: The Federal Open Market Committee (FOMC) left the federal funds target rate range at its current 3.50%-3.75%. The majority of the Committee members based their decision on the facts that economic activity has been expanding at a solid pace, the unemployment rate showed signs of stabilization, job gains remained low, and inflation continued to be somewhat elevated. Ten members of the Committee voted in favor of the monetary policy decision, while two members voted to reduce rates by 25.0 basis points.
  • GDP/budget: The economy expanded in the third quarter of 2025, impacted by a notable drop-off in goods imports due to tariffs, an increase in exports, and strong consumer spending. Gross domestic product accelerated at an annualized rate of 4.4% in the third quarter following an increase of 3.8% in the second quarter. A year ago, GDP expanded at an annualized rate of 3.3% in the third quarter. Consumer spending, as measured by the personal consumption expenditures index, rose 3.5% in the third quarter, higher than in the second quarter (2.5%) but below the 2024 pace of 4.0%. Spending on services rose 3.6% in the third quarter, compared with a 2.6% increase in the second quarter. Consumer spending on goods increased 3.0% in the third quarter (2.2% in the second quarter). Private domestic investment advanced from -13.8% in the second quarter to 0.0% in the third quarter. Nonresidential (business) fixed investment rose 3.2% in the third quarter compared with a 7.3% increase in the second quarter. Residential fixed investment declined 7.1% in the third quarter, higher than the 5.1% decrease in the second quarter. Exports rose 9.6% in the third quarter, compared with a 1.8% decrease in the previous quarter. Imports, which are a negative in the calculation of GDP, declined 4.4% in the third quarter after falling 29.3% in the second quarter.
  • December 2025 saw the federal budget deficit come in at $145 billion, roughly $58 billion more than the deficit of $87 billion from a year earlier. In December, receipts totaled $484 billion, while expenditures were $629 billion. Over the three months of the current fiscal year, the government deficit sits at $602 billion, 18% less than the cumulative deficit over the same period of the previous fiscal year. Over the same three months, individual income taxes, at $606 billion, account for nearly half of the total receipts of $1,225 billion. Total expenditures for this fiscal year equal $1,827 billion, of which Social Security ($402 billion) and National Defense ($267 billion) account for the largest outlays.
  • Inflation/consumer spending: According to the latest Personal Income and Outlays report, which covers October and November, personal income increased 0.1% in October, followed by a 0.3% advance in November. Disposable (after-tax) personal income ticked up 0.1% in October, followed by an increase of 0.3% in November. Personal consumption expenditures (PCE) rose 0.5% in October, the same increase as in November. From the preceding month, the PCE price index increased 0.2% in both October and November. Excluding food and energy, the PCE price index also increased 0.2% in both months. From the same month one year ago, the PCE price index increased 2.7% in October, followed by an increase of 2.8% in November. Excluding food and energy, the PCE price index also increased 2.7% in October, followed by an advance of 2.8% in November.
  • The Consumer Price Index advanced 0.3% in December and 2.7% for the year, which was the same increase as over the 12 months ended in November. The largest factor in the December increase was a 0.4% rise in shelter prices. Food prices increased 0.7% over the month, while energy prices rose 0.3% in December. Prices less food and energy rose 0.2% in December. Over the last 12 months, prices for shelter rose 3.2%, energy prices increased 2.3%, and food prices increased 3.1%.
  • The latest data reveals that the Producer Price Index increased 0.5% in December after rising 0.2% in November. Producer prices increased 3.0% in 2025 after advancing 3.5% in 2024. In December, prices for goods were unchanged from the previous month, while prices for services rose 0.7%. Excluding foods, energy, and trade services, producer prices moved up 0.4% in December.
  • Housing: Existing home sales rose 5.1% in December and 1.4% over the last 12 months. Inventory of existing homes for sale in December, at a 3.3-month supply, declined 21.4% from November’s estimate but was in line with the rate from December 2024. The median sales price in December was $405,400, down from $410,000 in November, but higher than the December 2024 estimate of $403,700. Sales of existing single-family homes also rose 5.1% in December (1.8% over the last 12 months). The median sales price for existing single-family homes in December was $409,500, down from the November price of $415,100, and marginally higher than the December 2024 price of $408,500.
  • The latest report on new home sales from the Census Bureau was released on January 13 and was for October. Sales of new single-family houses in October 2025 were 0.1% below the September rate but 18.7% above the October 2024 estimate. Inventory of new single-family homes for sale in October represented a supply of 7.9 months at the current sales rate, virtually unchanged from the September estimate but 15.1% below the estimate from a year earlier. The median sales price of new houses sold in October 2025 was $392,300. This was 3.3% below the September 2025 price of $405,800 and 8.0% below the October 2024 price of $426,300. The average sales price of new houses sold in October 2025 was $498,000. This was 3.0% above the September 2025 price of $483,500 but was 4.6% below the October 2024 price of $521,900.
  • Manufacturing: Industrial production (IP) increased 0.4% in December and grew 2.0% for the year. Manufacturing output rose 0.2% in December and 2.0% for 2025. In December, the index for mining fell 0.7% (+1.7% for the year), while the index for utilities climbed 2.6% (+2.3% for 2025).
  • New orders for durable goods, up three of the last four months, rose 5.3% in November. This followed a 2.1% September decline. Excluding transportation, new orders increased 0.5%. Excluding defense, new orders increased 6.6%. Transportation equipment led the November increase, climbing 14.7%, marking the third monthly increase in the last four months.
  • Imports and exports: U.S. import prices increased 0.4% over the two months from September 2025 to November 2025, according to the latest report from the Bureau of Labor Statistics (BLS). Prices for exports increased 0.5% over the two months from September 2025 to November 2025. The BLS did not collect survey data for October 2025 due to a lapse in appropriations. Prices for imports increased 0.1% from November 2024 to November 2025. Export prices increased 3.3% over the 12-month period ended in November.
  • The international trade in goods deficit for August was $85.5 billion, 16.8% under the July estimate. Exports of goods for August dipped 1.3%, while imports of goods declined 7.0%. Over the 12 months ended in August, exports decreased 0.4% and imports fell 4.1%.
  • The latest information on international trade in goods and services, released January 29, 2026, was for November and revealed that the goods and services trade deficit was $56.8 billion, an increase of $27.6 billion from the October deficit. November exports were $292.1 billion, $10.9 billion, or 3.6% less than October exports. November imports were $348.9 billion, $16.8 billion, or 5.0%, above the October estimate. Year to date, the goods and services deficit increased $32.9 billion, or 4.1%, from the same period in 2024. Exports increased $185.7 billion, or 6.3%. Imports increased $218.6 billion, or 5.8%.
  • International markets: European equities opened 2026 with record highs, extending the strong rally from late 2025. Tech and defense stocks were the main drivers of gains in January. European investors mostly shrugged off geopolitical tensions, particularly U.S. military involvement in Venezuela and tariff threats related to Greenland. Asian markets saw a heavy influx of capital and record-setting indexes but mixed performance across major countries. For January, the STOXX Europe 600 Index rose 2.6%; the United Kingdom’s FTSE advanced 2.5%; Japan’s Nikkei 225 Index gained 5.9%; and China’s Shanghai Composite Index increased 3.8%.
  • Consumer confidence: January saw consumer confidence decline after a moderate increase in December. The Conference Board Consumer Confidence Index® decreased 9.7 points in January to 84.5 from an upwardly revised 94.2 in December. The Present Situation Index, based on consumers’ assessment of current business and labor market conditions, fell 9.9 points to 113.7 in January. The Expectations Index, based on consumers’ short-term outlook for income, business, and labor market conditions, decreased 9.5 points to 65.1 in January, well below the threshold of 80.0 that usually signals a recession ahead.

Eye on the Month Ahead

Heading into February, investors will likely focus on international trade, AI and big tech companies, and whether there will be a shift in the U.S. monetary policy.

What I’m Watching This Week – 2 February 2026

Published on by dredheadz

The Markets (as of market close January 30, 2026)

Equities ended the week mostly lower as investors parsed through a heavy slate of fourth-quarter earnings data, economic reports, high valuations, and the Federal Reserve’s decision to maintain interest rates at their current levels. Several of the benchmark indexes hit notable highs midweek, with the S&P 500 surpassing the 7,000 level. Nevertheless, stocks generally retreated by the close of trading last Friday, with only the S&P 500 and the Global Dow able to end the week higher. Seven of the 11 market sectors closed the week higher, led by communication services and energy. Of the remaining sectors, health care saw the largest decline. Ten-year Treasury yields and the dollar were relatively unchanged from the previous week. Crude oil prices continued to trend higher, supported by rising geopolitical tensions.

Stock Market Indexes

Market/Index2025 ClosePrior WeekAs of 1/30Weekly ChangeYTD Change
DJIA48,063.2949,098.7148,892.47-0.42%1.73%
NASDAQ23,241.9923,501.2423,461.82-0.17%0.95%
S&P 5006,845.506,915.616,939.030.34%1.37%
Russell 20002,481.912,669.162,626.55-1.60%5.83%
Global Dow6,169.346,368.906,421.400.82%4.09%
fed. funds target rate3.50%-3.75%3.50%-3.75%3.50%-3.75%0 bps0 bps
10-year Treasuries4.16%4.23%4.24%1 bps8 bps
US Dollar-DXY98.2697.4797.11-0.37%-1.17%
Crude Oil-CL=F$57.46$61.29$65.556.95%14.08%
Gold-GC=F$4,323.90$4,981.60$5,067.501.72%17.20%

Chart reflects price changes, not total return. Because it does not include dividends or splits, it should not be used to benchmark performance of specific investments.

Last Week’s Economic News

  • In a ten-to-two vote, the Federal Open Market Committee (FOMC) decided to maintain the federal funds target rate range at the current 3.50%-3.75%. Two members voted to reduce rates by 25.0 basis points. The Committee held rates unchanged following three consecutive 25.0-basis-point rate reductions, which brought rates to their lowest level since 2022. Policymakers noted that, although economic activity has been expanding at a solid pace and the unemployment rate has shown signs of stabilizing, job gains have remained low and inflation has continued to be somewhat elevated. The FOMC indicated that it “would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.”
  • The Producer Price Index (PPI) rose 0.5% in December following increases of 0.2% in November and 0.1% in October. Producer prices rose 3.0% in 2025 after moving up 3.5% in 2024. Producer prices less foods, energy, and trade services moved up 0.4% in December, the eighth consecutive increase. Prices less foods, energy, and trade services rose 3.5% in 2025 following a 3.6% advance in 2024. Prices for services advanced 0.7% in December, the largest increase since moving up 0.9% in July. Prices for goods were unchanged in December following a 0.8% increase in November.
  • The latest report on durable goods orders, released January 26, was for November and saw new orders increase 5.3% following a 2.1% decline in October. Excluding transportation, new orders increased 0.5%. Excluding defense, new orders rose 6.6%. Transportation equipment, up three of the last four months, led the increase, climbing 14.7%.
  • The goods and services deficit was $56.8 billion in November, up $27.6 billion, or 94.6%, from $29.2 billion in October. November exports were $292.1 billion, $10.9 billion, or 3.6%, less than October exports. November imports were $348.9 billion, $16.8 billion, or 5.0%, more than October imports. Over the last 12 months ended in November, the goods and services deficit increased $32.9 billion, or 4.1%, from the same period in 2024. Exports increased $185.7 billion, or 6.3%. Imports increased $218.6 billion, or 5.8%.
  • For the week ended January 24, there were 209,000 new claims for unemployment insurance, a decrease of 1,000 from the previous week’s level, which was revised up by 10,000. According to the Department of Labor, the advance rate for insured unemployment claims for the week ended January 17 was 1.2%, unchanged from the previous week’s rate. The advance number of those receiving unemployment insurance benefits during the week ended January 17 was 1,827,000, a decrease of 38,000 from the previous week’s level, which was revised up by 16,000. This is the lowest level for insured unemployment since September 21, 2024, when it was 1,825,000. States and territories with the highest insured unemployment rates for the week ended January 10 were Rhode Island (2.9%), New Jersey (2.8%), Massachusetts (2.7%), Washington (2.7%), Minnesota (2.5%), California (2.3%), Illinois (2.3%), Puerto Rico (2.2%), Michigan (2.1%), Montana (2.1%), and New York (2.1%). The largest increases in initial claims for unemployment insurance for the week ended January 17 were in California (+5,504), Kentucky (+2,817), Puerto Rico (+462), South Carolina (+348), and the Virgin Islands (+15), while the largest decreases were in New York (-9,464), Georgia (-5,710), Pennsylvania (-4,836), Ohio (-4,664), and Texas (-4,440).
  • The national average retail price for regular gasoline was $2.853 per gallon on January 26, $0.047 per gallon above the prior week’s price but $0.250 per gallon less than a year ago. Also, as of January 26, the East Coast price increased $0.038 to $2.801 per gallon; the Midwest price ticked up $0.045 to $2.693 per gallon; the Gulf Coast price rose $0.058 to $2.455 per gallon; the Rocky Mountain price climbed $0.042 to $2.536 per gallon; and the West Coast price rose $0.048 to $3.705 per gallon.

Eye on the Week Ahead

The jobs report for January is out this week. Growth in the labor sector has slowed considerably over the past several months. There were only 50,000 new hires in December, and the unemployment rate ticked up to 4.4%.