Stock indexes saw a significant rally on Friday, with the Dow Jones Industrials reaching a new all-time high. Chipmakers, software companies, and AI-infrastructure stocks, which had experienced sharp losses earlier in the week, rebounded strongly as investors engaged in dip buying. The surge in stock indexes was further fueled by the unexpected rise in the University of Michigan US Feb consumer sentiment index to a 6-month high.
However, not all stocks experienced gains on Friday. Amazon.com faced a decline of more than -5% after announcing plans to invest $200 billion in data centers, chips, and other equipment, leading to concerns about the long-term viability of its artificial intelligence ventures.
The University of Michigan US Feb consumer sentiment index exceeded expectations by rising to 57.3, a 6-month high. Additionally, the 1-year inflation expectations dipped to a 13-month low of 3.5%, while the 5-10 year inflation expectations slightly rose to 3.4%. US Dec consumer credit also saw a strong increase of +$24.045 billion, surpassing expectations.
Federal Reserve comments on Friday presented a mixed outlook for stocks and bonds. Fed Vice Chair Philip Jefferson expressed cautious optimism about the US economy’s future, highlighting the potential for strong productivity growth to help reach the Fed’s 2% inflation target. Conversely, Atlanta Fed President Raphael Bostic emphasized the importance of maintaining a restrictive monetary policy to drive inflation back to 2%.
Bitcoin surged more than +11% on Friday, recovering from a 1.25-year low and lifting cryptocurrency-exposed stocks. The rebound in Bitcoin came after a significant selloff that had previously caused a more than 50% decline from its October record high.
In the realm of earnings reports, over 150 S&P 500 companies reported their Q4 earnings this week, with a majority beating expectations. The positive earnings trend is expected to continue, with S&P earnings projected to increase by +8.4% in Q4. European government bond yields displayed a mixed performance on Friday, with the 10-year German bund yield rebounding and the 10-year UK gilt yield falling.
Overall, the markets are currently pricing in a 19% chance of a -25 bp rate cut at the next policy meeting on March 17-18. Overseas stock markets settled with varying results on Friday, with the Euro Stoxx 50 closing up by +1.23%, China’s Shanghai Composite closing down by -0.25%, and Japan’s Nikkei Stock 225 closing up by +0.81%.
In the US stock market, various companies experienced significant movements on Friday. Chip makers and AI-infrastructure stocks saw notable gains, with companies like ARM Holdings Plc, Super Micro Computer, and Nvidia leading the Dow Jones Industrials gainers. Cryptocurrency-exposed stocks also rallied, with Strategy, MARA Holdings, and Riot Platforms among the top performers. On the downside, companies like Molina Healthcare, Stellantis NV, and Amazon.com faced declines.
Looking ahead, upcoming earnings reports on February 9, 2026, include companies such as AECOM, Apollo Global Management Inc, Becton Dickinson & Co, and ZoomInfo Technologies Inc. As the market continues to adjust to economic indicators and corporate performance, investors are closely monitoring developments to navigate the evolving financial landscape.
