Market Data as of Week Ending: 2/20/2026 unless noted otherwise
U.S. equities rose over the holiday-shortened week as investors were focused on corporate earnings and a 6-3 Supreme Court decision that has declared the Trump administration’s recent trade tariffs illegal, citing an overextension of executive power. While the ruling halts the policy, it offers no immediate clarity on potential rebates for businesses that have already paid into the program. Investors appeared to breathe a sigh of relief over the news as markets rallied on Friday, the S&P 500 closed the week up 1.24%. Large-cap growth companies performed the best, reversing recent trends, as they try to narrow the year-to-date gap between their value counterparts. Cyclical sectors had a strong week, building on their recent strength, as industrials, financials and energy contributed meaningfully. Oil prices reached a six-month high last week amid escalating tensions between the U.S. and Iran, with the U.S. amassing the most air power in the Middle East since 2003. Defensive sectors, such as consumer staples and health care underperformed, giving back some of their strong gains from previous weeks. International equities were positive on the week, however, lagging U.S. stocks.
Bonds were down last week as Treasury yields rose after FOMC meeting minutes showed policymakers remain divided on whether to prioritize the labor market or curb inflation. The 2-year Treasury yield rose by 8 basis points to 3.48%, while the 10-year yield rose by 4 basis points to 4.08%. Long-duration high-yield bonds were the best-performing sector, while long-duration government bonds lagged. Investment-grade and high-yield corporate bond yields remained unchanged, ending the week at 4.74% and 7.06%, respectively.
U.S. economic data last week painted a mixed backdrop. The National Association of Home Builders (NAHB) housing index fell to 36 in February as builders reduced their expectations as buyers continue to cite affordability challenges. Industrial production rose to 0.7% in December, up from 0.2% and beating expectations, thanks to a healthy 0.6% increase in manufacturing output, which was the biggest since February 2025. The U.S. trade deficit widened by -$70.3B, reaching its third-largest deficit on record in 2025 as imports rose nearly 5% last year and hit a record high. U.S. GDP expanded by 1.4% in Q4, a significant drop from Q3 as the extended government shutdown weighed on government spending as well as a deceleration in consumer spending. The PCE index rose 0.4% month over month in December and 2.9% year over year. Core PCE rose by 0.4% in December, reaching an annual rate of 3.0%, hitting its highest level in almost a year. The S&P Flash Services PMI fell to 52.3 in February, marking a 10month low amid weakening demand, high prices and adverse weather.