The weekend’s headlines were dominated by yet more repulsive Epstein slime which has thankfully (so far) not seeped into the consideration of US financial markets, although UK Prime Minister Starmer is certainly feeling the heat about probable related diplomatic cover-ups. The recent gold and silver party came to a crunching halt and prices utterly collapsed in what was the biggest precious metals crash in modern history.
The carnage extended to crypto which has finally been exposed as nothing more than a speculative asset. Bitcoin is now in complete free-fall, having crashed by 50% in three months and by 27% already in 2026. The price is well below where it was when its supposed champion Trump was elected. Over a trillion dollars in value has been lost in crypto since October.
However, stock markets had earnings squarely in focus on Monday, recovering strongly following a three-day pullback from record highs to start a week containing more Mag 7 and other big name reporting - but Friday’s scheduled Jobs Report fell victim to the shutdown with the Bureau of Labor Statistics temporarily closed.
Traders also continued to digest the nomination of Kevin Warsh to head up the Federal Reserve in May who is seen as perhaps more inclined than the other candidates to make a stand against inflation. Palantir and Samsung impressed with their earnings reports. The indexes finished nicely higher.
Software names got badly spooked on Tuesday morning by an Anthropic product release and Monday’s gains in the major indexes were instantly wiped out and things only went further downhill from there, especially for the NASDAQ as tech names were heavily pounded.
More earnings reports on Wednesday morning, with Wall Street handing out flowers to Eli Lilly but brutally punishing AMD and Novo Nordisk. The nagging doubts about AI spending and financing that had triggered Tuesday’s tech wipeout would not go away and the major indexes found it tough to mount any kind of meaningful comeback, eventually falling back again to close in the red with AI and software names once again the most damaged as the violent rotation out of 2025’s winners and into more defensive and value-oriented sectors picked up speed.
Alphabet/Google reported decent Q4 earnings after the close but announced plans to double its AI spend to a level far higher than analysts expected and Wall Street is currently fixated on capital expenditure when it comes to tech companies. The after-market took the stock lower.
Interest rates were held steady in the Euro Zone and the UK overnight on Thursday. Private surveys and government JOLTS data showed the most US layoffs since 2009, a steep decline in job openings and a jump in weekly Jobless Claims which didn’t bode well for the upcoming delayed Jobs Report.
The tech rout deepened, accelerated by earnings-driven declines from index heavyweights Google and Qualcomm. After a brief hiatus, precious metals and crypto resumed their colossal price drops. This time there was nowhere to hide and by the close there was blood red spattered everywhere across trading screens.
Any hopes that Amazon’s report after the bell would stop the pain were dashed as the week’s steady drumbeat of troubling news continued. The earnings came in largely as anticipated but traders got déjà-vu when the company announced projected expenditure that blew through expectations and the stock price crumbled.
The indexes rebounded hard on Friday despite Amazon’s meltdown as dip buyers, bottom fishers and bargain hunters seemed to decide that, for the time being at least, enough was enough and swooped in to pick up some of the most beaten-down names, driving the indexes solidly higher by the close, with the S&P 500 managing to close out the week barely changed and the more tech-light Small Caps and international stocks actually finishing with weekly gains. Even crypto and precious metals temporarily paused their relentless nosedives.
The postponed Job Report will now come out this coming Wednesday and the latest CPI inflation numbers on Friday, making the upcoming week a jumbo one for important economic data.
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ARTICLE OF THE WEEK ..
How do you stack up? The average/median net worth by age in America.
.. AND I QUOTE ..
“Things that have never happened before happen all the time.”
Morgan Housel, author and co-founder of The Collaborative Fund
LAST WEEK BY THE NUMBERS:
Last week’s market color courtesy of finviz.com
Last week’s best performing US sector: Consumer Defensive (two biggest holdings: Walmart, Costco) ⬆︎ 5.3% for the week
Last week’s worst performing US sector: Communication Services (two biggest holdings: Google, Meta) ⬇︎ 3.6% for the week
* SPY, a US Large Cap ETF, tracks the S&P 500 index, made up of 500 stocks from a universe of the largest US companies. Its price fell 0.2% last week, is up 1.3% so far this year and ended the week 1.0% below its all-time record closing high (01/27/2026).
* IWM, a US Small Cap ETF, tracks the Russell 2000 index, made up of the bottom two-thirds in terms of company size of a universe of 3,000 of the largest US stocks. Its price rose 2.1% last week, is up 7.7% so far this year and ended the week 2.4% below its all-time record closing high (01/22/2026).
* VXUS, a Global Non-US ETF, tracks the MSCI ACWI Ex-US index, made up of over 8,500 of the largest names from a universe of stocks issued by companies from around the world excluding the United States, in both developed and emerging markets. Its price rose 1.7% last week, is up 7.4% so far this year and ended the week 0.5% below its all-time record closing high (01/27/2026).
INTEREST RATES:
* FED FUNDS RATE * ⬌ 3.625% (unchanged from a week ago)
* PRIME RATE ** ⬌ 6.75% (unchanged from a week ago)
* 3 MONTH TREASURY ⬆︎ 3.68% (3.67% a week ago)
* 2 YEAR TREASURY ⬇︎ 3.50% (3.52% a week ago)
* 5 YEAR TREASURY ⬇︎ 3.76% (3.79% a week ago)
* 10 YEAR TREASURY *** ⬇︎ 4.22% (4.26% a week ago)
* 20 YEAR TREASURY ⬇︎ 4.80% (4.82% a week ago)
* 30 YEAR TREASURY ⬇︎ 4.85% (4.87% a week ago)
Data courtesy of the Federal Reserve and the Department of the Treasury as of the market close on Friday
* Decided upon by the Federal Reserve Open Market Committee at periodic meetings 8x a year. Used as a basis for overnight interbank loans and for determining high yield savings interest rates.
** Wall Street Journal Prime Rate as of Friday’s close. Tending to move in lockstep with the Fed Funds Rate, this measure is used as a basis for determining certain consumer loan interest rates such as credit cards, auto loans, personal loans, home equity loans/lines of credit and securities-based lending.
*** Used as a basis for determining mortgage interest rates and some business loans
AVERAGE 30-YEAR FIXED MORTGAGE RATE:
* ⬆︎ 6.11%
One week ago: 6.10%, one month ago: 6.16%, one year ago: 6.89%
Data courtesy of the Freddie Mac Primary Mortgage Market Survey
INTEREST RATE EXPECTATIONS:
Where will the Fed Funds interest rate be after the next rate-setting meeting on March 18th?
* Unchanged from now .. ⬇︎ 77% probability (85% a week ago)
* 0.25% lower than now .. ⬆︎ 23% probability (15% a week ago)
With seven more rate-setting meetings in 2026, what is the most commonly-expected number of remaining 0.25% Fed Funds interest rate cuts this year?
* ⬌ Two (unchanged from a week ago)
Data courtesy of CME FedWatch Tool
All data based on the Fed Funds interest rate (currently 3.625%). Calculated from Federal Funds futures prices as of the market close on Friday.
PERCENT OF S&P 500 STOCKS ABOVE THEIR OWN 200-DAY MOVING AVERAGE:
* ⬆︎ 67%
One week ago: 63%, one month ago: 63%, one year ago: 57%
Data courtesy of MacroMicro as of Friday’s market close
This widely-used technical measure of market breadth is considered to be a very robust indicator of the overall health of the S&P 500 index.
A high percentage (above 70%) generally suggests broad market strength and a bullish trend, while a low percentage (below 30%) may indicate market weakness and a bearish trend.
FEAR & GREED INDEX:
“Be fearful when others are greedy and be greedy when others are fearful.” Warren Buffett.
Data courtesy of CNN Business as of Friday’s market close
The Fear & Greed Index from CNN Business can be used as an attempt to gauge whether or not stocks are fairly priced and to determine the mood of the market. It is a compilation of seven of the most important indicators that measure different aspects of stock market behavior. They are: market momentum, stock price strength, stock price breadth, put and call option ratio, junk bond demand, market volatility and safe haven demand.
Extreme Fear readings can lead to potential opportunities as investors may have driven prices “too low” from a possibly excessive risk-off negative sentiment.
Extreme Greed readings can be associated with possibly too-frothy prices and a sense of “FOMO” with investors chasing rallies in an excessively risk-on environment . This overcrowded positioning leaves the market potentially vulnerable to a sharp downward reversal at some point.
A “sweet spot” is considered to be in the lower-to-mid “Greed” zone.
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