Weekly Market Performance — February 13, 2026

Markets Blog

David Matzko, LPL Research

LPL Research provides its Weekly Market Performance for the week of February 9, 2026. It was a volatile week in which U.S. equities fell as fears of AI disruption outweighed solid economic data, while international and emerging markets outperformed. Treasury yields declined amid strong demand for government bonds, reflecting a flight to quality. Commodities were mixed, with energy prices falling and gold rising on safe‑haven demand. January payrolls beat expectations, showing modest labor‑market strength despite weak overall hiring trends.

Stock Index Performance

U.S. and International Equities

U.S. Equities: Stocks fell this week as fears of AI disruption across several different business models — beyond software — spread across such industries as trucking and logistics, wealth management, insurance brokerage, office REITs, and others. The AI angst, that drove the financials sector down nearly 5% for the week, offset some encouraging economic data.

Job growth in January far exceeded expectations, with 130,000 jobs added in January. And the core Consumer Price Index (CPI) came in slightly cooler than expected, while the headline was right in line with expectations. A Friday rally pared the week’s losses, but as of 3 p.m. ET, the S&P 500 was tracking to its second straight decline — though of less than 1% — and its fifth drop in seven weeks. It’s fair to say the sector winners this week, including utilities, materials, real estate, consumer staples, and energy, are all more “old economy” and therefore relatively more immune to being replaced by AI.

Two other themes that are playing out in U.S. equity markets are dispersion and rotation. Stocks are moving in vastly different directions based on their earnings outlooks or the size of their competitive moats against AI threats, which, along with Magnificent (Mag) Seven underperformance, are giving stock pickers opportunities to add value by straying from benchmarks. The Mag Seven is down more than 2% this week, while the equal-weighted S&P 500 is up, a formula for continued outperformance by the value style over growth. It’s also important to keep in mind that we’re also seeing market participants rotate rather than leave the equity market. Some are calling it “chop” not “drop,” which we think fits.

International Equities: Another place the rotation is showing up is in international and emerging market (EM) equities. The outperformance by both asset classes against capitalization-weighted U.S. large cap stock market benchmarks has several drivers. Less perceived AI disruption, strategic placement in the technology supply chain (South Korea and Taiwan, in particular), a weaker dollar, and markets embracing political and policy shifts in Japan are some of the biggest drivers, while valuation support certainly doesn’t hurt.

Fixed Income, Currency, and Commodity Markets

Fixed Income: Core bonds, measured by the Bloomberg Aggregate Index traded higher this week as yields across the curve fell, with the 10-year yield lower by nearly 15 basis points and at the lowest levels of the year. Additionally, despite ongoing volatility in the equity markets, corporate credit spreads were little changed on the week.

This week, the Treasury Department auctioned $125 billion in 3‑, 10‑, and 30‑year bonds, with the 3‑year and 30‑year auctions ranking among the strongest in years. Thursday’s 30‑year auction — historically mixed in recent years — posted its strongest bid/cover ratio in eight years, signaling robust demand as investors sought safety amid heightened equity‑market volatility. This risk‑off shift drove Treasury yields to new year‑to‑date lows, while expectations for long‑term rate cuts declined. As highlighted in our 2026 Outlook, long‑term yields remain highly correlated with the market’s expectations for the Federal Reserve’s (Fed) reaction function and the eventual trough in the fed funds rate.

Thursday’s rally underscores that the flight‑to‑quality mechanism remains firmly intact — a long‑standing behavioral impulse for investors to seek safety in Treasuries during periods of market stress. With markets still pricing fed funds to trough near 3%, any true crisis would likely push the Fed to cut rates more aggressively than currently expected, allowing bonds to continue providing their traditional diversification benefits. Taken together, these dynamics suggest that as long as the Fed’s eventual policy path remains uncertain (and the Fed retains its credibility), we think Treasuries will continue to serve as a critical anchor for diversified portfolios.

Commodities and Currencies: Commodities traded modestly lower on the week as energy components lagged. Natural gas tumbled over 5% as weather forecasts for most of the U.S. called for above-average temperatures. Restored production following last month’s arctic blast and an uptick in rig counts weighed on supply concerns. West Texas Intermediate (WTI) crude oil slid 1% after struggling with resistance near $66.50. Easing tensions with Iran removed some of the recent geopolitical risk premium in oil as the White House continued to negotiate with the country on its nuclear ambitions and support for Hamas. Gold was a bright spot within the metals complex as safe haven demand pushed the yellow metal up over 1%. Copper fell 1.5% but pared some of its intra-week losses stemming from the risk-off AI trade. Aluminum also declined after reports indicated the administration may consider reducing tariffs on select aluminum and steel imports. The dollar dipped close to 1% but held above key support near 96. Safe haven demand, better-than-expected payrolls, and news of Russia potentially rejoining the dollar settlement system were offset by lower rates and Friday’s tame inflation data.

Economic Weekly Roundup

One big takeaway from today’s nonfarm payroll report is the 2025 average monthly gain in payrolls was 15,000. Labor demand came to a standstill last year. The other takeaway is the emerging trend in hours worked. The dip in unemployment gives the Fed some more time to wait and see how quickly the inflation picture improves before they start cutting rates again.

Highlights from January nonfarm payroll release:

• For January, businesses added 130,000 jobs to their payrolls, roughly double consensus forecasts. Gains were mostly in health care, social assistance, and construction. Federal government and financial activities lost jobs.

• We saw strong demand for specialty construction skills. Specialty trade contractors contributed 16% of the total monthly gain for January.

• Average workweek edged higher for all private employees. This may indicate that the “low hire, low fire” means employers are more inclined to add hours instead of adding headcount.

  
  

Bottom Line: Businesses have an anemic demand for workers. Average monthly payroll gains are expected to hover around 50,000, with employers increasing hours worked, especially in areas like construction with low supply of available workers. Despite our expectations of softer labor demand, nominal growth - which is a good predictor of corporate earnings growth - should approach 5% this year.

The Week Ahead

The following economic data is slated for the week ahead:

• Monday: Presidents’ Day holiday, no economic releases scheduled

• Tuesday: ADP Weekly Employment Change (Jan 31), Empire Manufacturing (Feb), NAHB Housing Market Index (Feb)

• Wednesday: MBA Mortgage Applications (Feb 13), Durable Goods Orders (Dec preliminary), Capital Goods Orders and Shipments (Dec preliminary), Housing Starts (Nov and Dec), Building Permits (Dec preliminary), New York Fed Services Business Activity (Feb), Industrial Production (Jan), Manufacturing (SIC) Production (Jan), Capacity Utilization (Jan), Leading Index (Jan), FOMC Meeting Minutes (Jan 28), Total Net TIC Flows and Net Long-term TIC Flows (Dec)

• Thursday: Advance Goods Trade Balance (Dec), Wholesale Inventories (Dec preliminary), Retail Inventories (Dec), Philadelphia Fed Business Outlook (Feb), Initial Jobless Claims (Feb 14), Continuing Claims (Feb 7), Trade Balance (Dec), Pending Home Sales (Jan)

• Friday: Personal Income and Spending (Dec), Headline and Core PCE Index (Dec), GDP (4Q first reading), Personal Consumption (4Q first reading), S&P Global U.S. Manufacturing, Services, and Composite PMIs (Feb preliminary), New Home Sales (Nov and Dec), University of Michigan Consumer Sentiment Report (Feb final), Building Permits (Dec final)

IMPORTANT DISCLOSURES

This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors. To determine which investment(s) may be appropriate for you, please consult your financial professional prior to investing.

Investing involves risks including possible loss of principal. No investment strategy or risk management technique can guarantee return or eliminate risk.

Indexes are unmanaged and cannot be invested into directly. Index performance is not indicative of the performance of any investment and does not reflect fees, expenses, or sales charges. All performance referenced is historical and is no guarantee of future results.

This material was prepared by LPL Financial, LLC. All information is believed to be from reliable sources; however LPL Financial makes no representation as to its completeness or accuracy.

Unless otherwise stated LPL Financial and the third party persons and firms mentioned are not affiliates of each other and make no representation with respect to each other. Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.

Asset Class Disclosures –

International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.

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High yield/junk bonds (grade BB or below) are below investment grade securities, and are subject to higher interest rate, credit, and liquidity risks than those graded BBB and above. They generally should be part of a diversified portfolio for sophisticated investors.

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The fast price swings of commodities will result in significant volatility in an investor's holdings.

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