Friday, February twentieth, 2026
Financial indexes had been on a roll currently, placing up better-than-expected figures on progress, productiveness, employment and so forth. That seems to have come to an finish this morning with a slew of information on progress and consumption, and pre-market indexes moved from flattish to barely within the crimson. The Dow is -86 factors at this hour, the S&P 500 is -15, the Nasdaq -77 and the small-cap Russell 2000 -15 factors.
This autumn GDP 2nd-Lowest of 2025: +1.4%
The preliminary print on Gross Home Product (GDP) for the fourth quarter of 2025 (This autumn) got here in at +1.4% this morning, under the +2.5% anticipated and 300 foundation factors (bps) decrease than the ultimate learn of Q3, however nonetheless increased than the -0.6% reported for Q1. This brings the preliminary GDP progress numbers from final yr to +2.3%, a smidge decrease than the +2.4% for 2024 and the +3.4% reported for 2023. The longest authorities shutdown in U.S. historical past throughout This autumn seemingly took among the fuel out of this headline quantity.
PCE Warms Up in December
Associated to GDP knowledge is the Private Consumption Expenditures (PCE) index for December — delayed from the federal government shutdown. Practically throughout the board, we’re seeing hotter outcomes than analysts had anticipated. Private Earnings got here in at +0.3%, 10 bps increased than anticipated however decrease than the upwardly revised +0.4% for November. Private Spending was as anticipated at +0.4%, equaling the upwardly revised prior month tally. “Actual” Spending, adjusting for inflation, got here in at +0.1%, a low not seen since September of final yr.
Headline PCE month over month additionally reached +0.4%, hotter than the +0.3% anticipated and double the prior month, which had been steadily +0.2% for 5 straight months. Core PCE month over month — stripping out unstable meals and vitality expenditures — was additionally +0.4%, additionally double November.
12 months over yr PCE, on headline, reached +2.9%, the very best since March 2024. This metric has grown by +0.1% monthly since October of final yr. Clearly, that is shifting the other way of cooling inflation ranges. Core PCE yr over yr got here in at +3.0%, 100 bps forward of the Fed’s inflation goal, and the loftiest print since April. That is additionally 30 bps increased than anticipated and a tick increased than the upwardly revised +2.9%.
To attempt to sum up all these figures, financial progress appears in first rate form — as long as the federal government can maintain from shutting down and taking upward of a full proportion level off our progress measures. In the meantime, inflation is proving cussed, seemingly as a consequence of tariff insurance policies enacted within the first half of 2025, however staggered somewhat erratically all through the 12 months (and past). Assuming tariff inflation is a “one-time occasion,” which many economists do, we might even see these PCE figures start to chill off within the coming months.
What to Count on from the Inventory Market As we speak
After at this time’s open, we anticipate to see new numbers from S&P PMI: flash Companies and Manufacturing for February. Final month, we noticed 52.7 on Companies and 52.4 on Manufacturing, each safely above the 50 threshold that determines progress from loss.
Additionally, the delayed New House Gross sales report comes out for December, Expectations are for the same tally, 738K seasonally adjusted, annualized models, that we noticed final time round. We search for some inexperienced shoots as mortgage charges have come down from peak ranges a pair years in the past, however they haven’t been straightforward to come back by thus far.
Buyers may even have an interest within the Supreme Courtroom’s determination, anticipated at this time, on whether or not President Trump’s tariff coverage is constitutional. Primarily based on precedent, it doesn’t appear seemingly the president has a lot to fret about — in rulings previous throughout this administration, the Supreme Courtroom has seen issues Trump’s manner on increasing the authority of the Government department, together with ICE working with out judicial oversight and issues of immigration and birthright citizenship.
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