Markets Update - 2/25/26

Update on US equity and Treasury markets, US economic data, the Fed, select commodities and a look at the upcoming day with lots of charts!

Feb 25, 2026

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US equity indices started the day trading modestly higher as traders awaited Nvidia earnings after the close (covered below). Nvidia rose +0.8% in premarket trading (it would end +1.4%a and extend following its earnings). Oracle also was higher after the name was upgraded at Oppenheimer, which sees a “favorable” risk-reward profile in the wake of its recent pullback. On the other side Lowe’s shares tumbled over -5% despite a strong prior quarter after the home improvement retailer issued lower-than-expected forward guidance for its current quarter.

Indices would end with moderate (Russell 2000 (RUT)) to solid (large cap) gains but took different paths to get there with the Nasdaq running from the open to finish +1.3%, while the SPX & DJIA steadily rose in the afternoon after an early dip to end +0.8 & +0.6%. The RUT though fell into negative territory in the morning before recovering, but lagged +0.4%.

Elsewhere, bond yields edged higher, but the dollar fell back. Bitcoin got a bounce and copper and natgas were also up (the latter though only after moving to a new contract at a lower price), while crude and gold fell back all covered in the subscriber section with charts).

The market-cap weighted S&P 500 (SPX) was +0.8%, the equal weighted S&P 500 index (SPXEW) though UNCH, Nasdaq Composite +1.3% (and the top 100 Nasdaq stocks (NDX) +1.4%), the SOXX semiconductor index +1.6%, and the Russell 2000 (RUT) +0.4%.

Morningstar style box mixed Wed with a clear preference for growth.

Market commentary:

“The global economy appears to be on slightly firmer footing as the effects of fiscal and monetary policy continue to support activity. Financial markets, however, have struggled to establish a clear direction amid several headwinds,” BMI said in a report on Wednesday, in reference to the AI-driven whipsaws lately in addition to heightened geopolitical risks. “We assign a 50% probability to a US-led military attack on Iran, which is contributing to an elevated risk premium in oil prices and, to some extent, US dollar strength,” BMI’s analysts said.
“Nvidia’s results are expected to be good given the massive capex announced by its clients, but it’s all about how the market will react,” said Arnaud Girod, head of cross-asset strategy at Kepler Cheuvreux. “The Nasdaq needs Nvidia if it is to limit its current underperformance.”
“A solid beat, and more importantly, strong guidance, will reaffirm the AI narrative,” said veteran strategist Louis Navellier. “Any sign of cautiousness could bring some meaningful volatility.”
“Whether such market confidence can be sustained in the coming days will partly depend on NVIDIA’s earnings,” wrote Ulrike Hoffmann-Burchardi, head chief investment officer for global equities, in a note. “With hyperscalers having announced another step-up in capex in recent weeks, markets expect the chipmaker to forecast revenue above consensus estimates alongside strong sales growth.”
Investors are stampeding into tech shares as Wall Street hopes that Nvidia results after the bell can reignite enthusiasm in the AI trade, according to Jose Torres at Interactive Brokers. Clearly, the bar is high as we head into the report, he added.
“Nvidia’s AI castle is no longer considered impenetrable because of its deep and wide moat,” said Hardika Singh at Fundstrat Global Advisors. “Earnings from the chip darling will show what kind of defenses it’s putting up against the horde of determined, well-equipped besiegers.”
“Somehow the Nvidia release doesn’t seem to have quite the same cachet that it has for much of the past few years. Perhaps that simply reflects the fact that the stock has gone largely nowhere over the past few months, or the idea that the market is now doling out punishments to AI-affiliated or impacted stocks as much as rewards.” — Cameron Crise, Macro Strategist, Markets Live
Michael Rosen, chief investment officer at Angeles Investment Advisors, cautions that investors shouldn’t bet against CEO Jensen Huang, saying that he’s “played his cards extremely well.” He also views the recent run the stock has had — it notched a fourth consecutive day of gains — as an opportunity for some profit-taking among those on Wall Street. Rosen believes that the worries that have plagued investors surrounding software and AI are “a bit overblown.”
“The market is, I think, moving from just throw everything into one category and make it go up to being a little bit more discerning as to which companies might be better positioned than others,” he said. Rosen also said that he believes the “sell-first, ask-questions-later” market is in the “ask-questions-later” phase where “things maybe are not quite so scary.”
“Once again, Nvidia came out and really stepped up to the plate with extremely impressive numbers across the board,” said Ryan Detrick at Carson Group. “This is a nice cherry on top to an extremely impressive overall earnings season for Corporate America.” While there are “some legit worries out there”, new highs in earnings and profit margins continue to justify this bull market, Detrick noted.
“Perhaps we are in a buy the rumor, sell the news era for markets, where the big AI/Magnificent Seven bull run over the past three years has driven up expectations to a fever pitch,” Michael Bailey, director of research at Fulton Breakefield Broenniman, said about the disconnect between earnings success and market moves. “In other words, a ‘beat and raise’ quarter is now table stakes, rather than a reason to celebrate.” “If companies can hit the red hot consensus growth estimates for 2026 and sentiment stays right where it is, we could be looking at another impressive market performance, with the S&P moving up 10-15% this year,” Bailey said.
“Investors are concerned about the future impacts of AI, whether it’s from the capex of the hyperscalers or the potential disruption to software companies and beyond,” said GMO’s Tom Hancock. “None of that has shown up in this quarter’s results (and likely won’t in this year’s), so there’s been some decoupling between the stock returns and current fundamentals.”
Results have been solid but uncertainty around elements like AI and private credit have “dampened” multiples that investors have been willing to pay for sectors like software and fintech, said Sameer Samana, head of global equities and real assets at Wells Fargo Investment Institute. This has caused the S&P 500 to “go sideways,” he added. And while other sectors, including industrials and energy, have gotten higher multiples due to a greater certainty and solid results, Samana notes these areas do not have as large a weighting. “Time is needed for investors to figure out the scope and pace of AI disruption,” Samana explained, adding that they will eventually come round to his view that things are “sound economically and additional highs lie ahead.”
The weakness of the Magnificent Seven stocks is spoiling sentiment at a time when a broadening market should theoretically cheer investors, according to Piper Sandler. “Consider the years 2023-2025, when these mega-caps surged and lifted the S&P 500 to new highs while most stocks severely lagged behind or even declined in some cases. Back then, equity sentiment was generally bullish as the index continued to move higher,” wrote Michael Kantrowitz, chief investment strategist at Piper Sandler. “Today, it feels like the opposite,” he continued. “While we’re seeing the strongest global and domestic equity breadth in many years, the weakness of the Mag 7 stocks are spoiling the party for some.”
Wolfe Research conducted a poll that suggests most investors bet the AI “wrecking ball” that’s roiled markets is largely “overblown,” said Chris Senyek. However, participants viewed the “broadening out” trade as alive.
Recent price action tied to AI disruption risk presents opportunities in well-positioned incumbents and AI adopters with pricing power, according to Morgan Stanley strategists including Andrew Pauker. The strategists also noted that an analysis of over 10,000 earnings and conference transcripts shows a steady increase in the share of companies seeing quantifiable benefits from AI adoption.
“Thematically, Trump ... followed his instinct to persuade voters that America is in a golden age, rather than empathizing with ‘affordability’ concerns,” Marcus wrote in a post-speech analysis. “He didn’t repeat his ‘affordability hoax’ line per se, but he said that Democrats ‘knew their statements [about affordability] were a dirty, rotten lie.’”
“We doubt he can talk voters into feeling better about the economy, which Biden also tried and failed to do, but he seems to have decided that the path to a midterm win is not rolling out some new ‘affordability agenda,’” Marcus wrote. “We had already argued that not much new policy would get implemented, but it’s notable that it’s not even being proposed.”
“We are unlikely to see the resumption of rate cuts until we see greater signs of disinflationary pressures coming through, which to our mind is more of a second-half-of-2026 story,” Cooper told Bloomberg TV. “All of the factors suggest we are in a higher-for-longer yield backdrop.”
Strategists at TD Securities said they remain “comfortable” with their bearish view on the U.S. dollar, citing the currency’s “strained” status as a haven.
In a note released on Wednesday, strategists Jayati Bharadwaj, Linda Cheng and Alex Loo said their view about the dollar is also based on “a continued ‘Hedge America’ trade” and “U.S. resilience falling short of exceptionalism amid a backdrop of solid global growth, lower rates, and fiscal buffers.”
While “lots can go wrong” with this bearish dollar view, “that does not seem too plausible in a midterm election year with the U.S. administration holding the cards to global macro volatility,” the strategists wrote.

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In individual stock action:

Stocks climbed in late hours on speculation that Nvidia Corp.’s strong outlook will help reignite confidence in the artificial-intelligence trade that has powered the bull market. The giant chipmaker that’s seen as a barometer for the revolutionary technology said fiscal first-quarter sales will be about $78 billion, beating the average estimate of $72.8 billion. Its shares gained about 1.5%.

President Donald Trump is convening tech executives from firms including Amazon.com Inc., Meta Platforms Inc., Microsoft Corp. and Alphabet Inc. at the White House next week to sign pledges committing their companies to foot the electricity bill for energy-hungry data centers.

Companies making the biggest moves after-hours from CNBC.

Corporate Highlights from BBG:

Salesforce Inc. gave a lukewarm outlook for sales growth, fueling worries that the software giant will lose out to new competitors in the age of AI.
Snowflake Inc. gave a sales outlook that was in line with estimates, disappointing investors who were looking for a stronger showing to overcome jitters about the software industry’s viability in the age of AI.
Paramount Skydance Corp. reported fourth-quarter earnings that beat projections, just days after submitting a new bid to acquire Warner Bros. Discovery Inc.
Advanced Micro Devices Inc. will buy $150 million in Nutanix Inc. stock as part of a new partnership that also includes joint engineering and sales efforts.
Lowe’s Cos.’s sales guidance for the full year fell short of expectations, a sign the housing market will remain lackluster in the near term.
Circle Internet Group Inc. soared after saying strong demand for its stablecoin bolstered profit and revenue during the fourth-quarter downturn in digital assets.