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WEEKLY SUMMARY: Risk assets under pressure as US PPI reaccelerates
Major U.S. stock indexes fell for the week as investors stayed cautious about AI-driven disruption and global trade and tariff uncertainty. The Dow Jones dropped 1.31%, while the S&P 500 Index declined a smaller 0.44%. Stocks sold off early after a research report heightened AI risk concerns, briefly stabilized ahead of NVIDIA’s earnings, but finished the week lower as strong results failed to shift the broader risk-off mood. On the economic front, inflation pressures resurfaced due to a larger-than-expected jump in producer prices. January PPI rose 0.5% MoM, driven mainly by services, and stood at 2.9% YoY. Meanwhile, U.S. factory orders fell 0.7% in December, weighed down by a sharp drop in commercial aircraft demand. Consumer sentiment showed modest improvement, with the Conference Board’s Consumer Confidence Index rising to 91.2 in February. Jobless claims edged slightly higher, while continuing claims declined, pointing to a still-resilient labor market. Bond markets benefited from the risk-off environment. U.S. Treasuries rallied, with the 10-year yield dropping below 4% for the first time since November. Investment-grade corporate bonds posted modest gains, while high-yield performance was mixed amid volatility in software and AI-related sectors. The STOXX Europe 600 Index touched a new high and notched a 0.52% gain over the week. Oil and Gold rose on the back of US-Iran tensions. Cryptos were volatile.
Have a great weekend
Charles & Syz Research Lab
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