General Market News

Norwegian utility Statkraft signed a seven-year power purchase agreement with Sweden's OX2 for two battery storage systems in Finland to manage growing wind power volatility. The batteries, totaling 235 megawatts, will begin operating in 2028 to help balance Finland's rapidly expanding wind capacity, which has nearly tripled since 2021. The deal addresses increasing price volatility, with negative-priced power hours surging from 5 in 2021 to 724 in 2024.

• The agreement covers two battery systems (110 MW and 125 MW) in western Finland, with Statkraft optimizing their use while providing OX2 guaranteed revenue for project financing
• Finland's installed wind capacity nearly tripled from 3,257 MW in 2021 to 9,433 MW in 2025, now accounting for 28% of total power generation
• Hours with negative electricity prices (below 0 euros/MWh) jumped from just 5 hours in 2021 to a peak of 724 hours in 2024, reflecting severe oversupply issues during high wind output periods

EDP Renovaveis (EDPR), the world's fourth-largest wind energy producer, reported a 50% jump in recurring net profit to 330 million euros in 2025, exceeding analyst expectations. The strong performance was driven by U.S. capacity expansion, though capital gains from asset sales declined significantly year-over-year.

• Recurring net profit reached 330 million euros ($389 million), beating the average analyst forecast of 307 million euros
• Capital gains from wind and solar park sales dropped to 95 million euros from 167 million euros in 2024, reflecting the company's strategy of divesting mature assets to fund new projects
• U.S. capacity expansion was the primary driver of profit growth for the Portuguese renewable energy company

European clean energy stocks face volatility as optimism about AI-driven electricity demand collides with policy risks, particularly potential reforms to the EU's carbon trading system. While utilities stocks have rallied over 40% in the past year on hopes of data center expansion boosting power consumption, Europe's electricity demand isn't expected to reach 2021 levels until 2028. Carbon prices have fallen over 20% from recent highs amid debate over ETS reform, threatening generator earnings.

• The International Energy Agency forecasts Europe's electricity demand won't return to 2021 levels before 2028, with average annual growth of only 2.3% expected in 2025-2030, lagging behind anticipated AI infrastructure build-out
• Carbon prices have dropped more than 20% as Germany and other EU members signal openness to reforming the Emissions Trading System, with policy clarity not expected until a July review
• Bank of America warns that in an 'highly unlikely' scenario where the EU scraps carbon cost pass-through to power prices, earnings for pure-play generators like Verbund, ERG and Acciona Energia could fall over 30%

Indian solar manufacturing stocks plummeted on February 25 after the U.S. Commerce Department announced preliminary countervailing duties of 125.87% on solar cells and panels imported from India, along with Indonesia and Laos. The duties aim to offset government subsidies supporting manufacturers in these countries, dealing a significant blow to India's solar export industry.

• Waaree Energies dropped as much as 15% in its worst trading session ever, while Premier Energies and Vikram Solar fell up to 14.2% and 7.8% respectively before partially recovering.
• The U.S. determined a general subsidy rate of 125.87% for solar imports from India, one of the highest rates imposed on the affected countries.
• The duties target government subsidies supporting solar manufacturers and could severely impact Indian companies' competitiveness in the U.S. market, a key export destination.

Global M&A activity surged 40% to $4.9 trillion in 2025, the second-highest level on record, driven by AI demand and improved conditions after a slow start due to tariffs. While 80% of executives expect sustained or increased deal activity in 2026, companies face the tightest capital squeeze in 30 years as cash is increasingly directed to dividends, buybacks, and AI infrastructure spending.

• Mega-deals over $5 billion accounted for 73% of the increase in deal value, with 60 deals exceeding that threshold in 2025, the highest since 2021
• The proportion of capital allocated to M&A hit a 30-year low in 2025 as competing priorities like AI capital expenditures diverted funds, with U.S. hyperscalers spending an average of $760 million per day on AI infrastructure
• Private equity now represents roughly 40% of global M&A activity, while private credit markets valued at $2.1 trillion are expected to double by 2030, providing alternative funding sources

The Conference Board's consumer confidence index rose 2.2 points to 91.2 in February, beating economist expectations of 87, as Americans grew less pessimistic about labor market conditions. The increase reversed January's decline, though confidence remains well below the November 2024 peak. Improved expectations for business and labor market conditions six months out drove the gains.

• Four of five index components firmed in February, with the labor market differential (jobs plentiful minus jobs hard to get) improving from -10% to -7.5%
• Confidence rose among Republicans and Independents but continued declining for Democrats; younger consumers under 35 showed the most optimism among age groups
• Despite the uptick, consumer write-in responses remained pessimistic, focused on prices, tariffs, cost of goods, and political uncertainty

Despite the NASDAQ falling 5% from its October high and tech underperforming the S&P 500 in 2026, analysts argue this represents a late-stage bull market correction rather than a cycle end, creating buying opportunities. Several major tech stocks including Adobe, Intuit, and The Trade Desk have fallen into oversold territory with RSI readings below 30 and significant year-to-date losses. Improving valuations, such as Meta's forward P/E of 24.13 and Adobe's 14.78, suggest tech stocks are becoming cheaper relative to their earnings potential.

• Tech stocks are down 2.15% year-to-date, making it the second-worst performing S&P 500 sector, with some names like Salesforce down 43% YTD and UiPath down more than 46%.
• Multiple tech stocks show extreme oversold conditions with RSI readings between 18-33, while analysts project significant upside potential of 25% to 48% over the next 12 months for names like HubSpot, Intuit, and Adobe.
• Historical data supports continued bull market momentum, as average bull markets last 5-7 years and fourth-year cycles (where 2026 sits) typically deliver positive returns, with Morgan Stanley noting that 'investors who take higher risk may be rewarded'.

Two Federal Reserve officials expressed optimism that artificial intelligence will not cause major economic disruption. Boston Fed President Susan Collins and Richmond Fed President Thomas Barkin said AI appears to be enhancing workers rather than displacing them, adopting a 'cautious optimist' stance on the technology's economic impact.

• Boston Fed President Susan Collins described herself as a 'cautious optimist' on AI's economic effects
• Both officials observed that workers are currently being enhanced by AI rather than displaced by the technology
• The comments were made at a conference held by the Federal Reserve Bank of Boston

U.S. stocks rebounded on February 24, 2026, with the Nasdaq 100 climbing 1% as concerns about AI disruption to enterprise software faded. Anthropic's Claude product event reassured investors by positioning the AI as a complement rather than replacement to existing business tools, while AMD surged 10% on a major Meta data center deal.

• Anthropic's Claude announcement calmed software sector fears, with DocuSign up 4%, Salesforce up 4%, and ServiceNow up 2%, though the IGV ETF remains down 30% from yearly highs
• AMD jumped 10% after Meta agreed to deploy 6GW of AMD GPUs in AI data centers, backed by a performance-based warrant for up to 160 million shares
• The S&P 500 faces key resistance at the 50-day moving average (6931.25), with traders watching whether it can sustain a move above 6931.75 to turn bullish

JPMorgan Chase CEO Jamie Dimon warned that AI could eliminate jobs 'faster than we can adjust to' and urged the U.S. government to work with businesses on policies to address potential job displacement. His comments came as JPMorgan stock and other financial shares fell amid viral fears of mass AI-driven layoffs triggering a 2027 recession. Dimon proposed an AI-era version of trade adjustment assistance to help retrain displaced workers.

• Dimon used a 'thought exercise' involving 2 million truck drivers being replaced by autonomous vehicles to illustrate the need for phased implementation and worker support systems
• JPMorgan's consumer banking division expects headcount to decline about 10% over five years even as the business grows more than 25%, with the company already developing 'huge redeployment plans' for AI-displaced workers
• JPM stock fell 4.2% Monday to a four-month low and remained flat Tuesday, while the company maintained a cautiously optimistic 2026 outlook with projected net interest income of $104.5 billion

Biotech stocks are emerging as potential market leaders in 2026 after surging 75% from April 2025 lows, significantly outperforming broader markets. The sector is being driven by fundamental improvements including accelerating drug development, increasing M&A activity from major pharmaceutical companies facing patent cliffs, and renewed investor appetite for growth-oriented sectors.

• The SPDR S&P Biotech ETF (IBB) rallied approximately 75% from April 2025 lows through early 2026, reversing years of underperformance from 2021-2024
• Large pharmaceutical companies are actively pursuing biotech acquisitions to fill revenue gaps from upcoming patent expirations, creating valuation support across the sector
• Key risks include interest rate pressures on growth sectors, regulatory uncertainties around drug pricing, and competition for capital from AI and other high-growth themes

Investors are bracing for President Trump's State of the Union speech on Tuesday, which could increase market anxiety amid already volatile conditions. The speech may address market-moving policies including Iran, tariffs, Federal Reserve governance, and affordability measures. While the S&P 500 has gained 13% over 400 days since Trump's January 2025 inauguration, it has barely increased in 2026 as markets struggle with policy uncertainty.

• Trump's speech could impact crude oil prices if he issues an Iran military ultimatum, and bond markets if he proposes mortgage affordability measures or stimulus checks ahead of November midterm elections
• Market strategists warn that continued reliance on executive action to implement policies has created 'chaos, confusion and uncertainty' that could further spook investors
• The proposed 10% cap on credit card interest rates is being closely watched by Wall Street, while any new deficit-raising stimulus proposals could send bond yields higher

See It Market argues the U.S. is approaching a 'Japanification' scenario—a prolonged economic stagnation and asset revaluation—as the culmination of disruptions since 2016. The analysis traces how interrupted wage normalization, pandemic-era interventions, and weakening capital reflexivity have delayed necessary economic clearing mechanisms. The key question now is whether foreign capital will continue flowing to U.S. assets during crises or if American exceptionalism is exhausting itself.

• The healthy recovery sequence from 2016 (when commodities and wages bottomed together) was broken by trade wars and pandemic interventions, causing asset prices to reflate before wages recovered and widening inequality through the Cantillon effect
• Decades of crisis-driven capital flows to the U.S. as a safe haven inflated valuations to unsustainable levels, a dynamic now weakening as dollar reserve currency privilege and American exceptionalism face structural constraints
• Multiple delayed economic clearings (2008, 2020) have pushed the reckoning further out; confirmation of Japanification will come from whether capital continues reflexively returning to U.S. assets or starts flowing elsewhere

Wall Street strategists have raised their S&P 500 target to 7,500 by end of 2026, representing a roughly 10% gain from current levels around 6,892. The forecast, based on a Reuters survey of 44 market professionals, would mark a fourth consecutive year of gains for the benchmark index, driven by expectations of solid corporate earnings growth and steady economic expansion.

• Analysts project S&P 500 earnings growth of 14.8% in 2026, with technology companies expected to drive much of the expansion through 33% profit growth in the sector
• Despite the optimistic year-end target, a majority of strategists expect a market correction within the next three months, viewing it as a potential reset rather than a trend reversal
• Key risks include persistent inflation pressures, Federal Reserve policy decisions on rate cuts, and trade tensions linked to President Trump's policies

U.S. stock indexes rebounded on Tuesday, February 24, 2026, with the S&P 500 up 0.8%, Dow Jones up 0.9%, and Nasdaq up 1.1%, recovering from Monday's sharp selloff. The Monday decline was driven by AI disruption fears sparked by speculation about Anthropic's AI capabilities and renewed tariff uncertainty after President Trump raised global tariff rates to 15%. Tuesday's recovery was fueled by Anthropic's clarification that its Claude AI would serve as an 'orchestration layer' integrating with existing software rather than replacing it.

• Monday's selloff saw IBM drop 13% after speculation that Anthropic's AI could modernize legacy COBOL code, threatening its consulting business, while broader AI disruption fears affected multiple tech stocks.
• Trump raised global tariff rates to 15% after the Supreme Court struck down his emergency-powers tariffs on Friday, creating ongoing policy uncertainty that pressures growth stocks and high-risk investments.
• Anthropic's Tuesday event reassured investors by positioning Claude as complementary to existing tools like DocuSign and Salesforce rather than competitive, triggering rebounds in these stocks and lifting major indexes.

Swiss National Bank Chairman Martin Schlegel reported that while U.S. tariffs have weighed on global growth, much of the world economy has shown greater resilience than anticipated. His remarks come as Switzerland maintains low inflation at 0.1% in January 2026, and survey data reveals mixed impacts on Swiss companies from tariff policies.

• Approximately 25% of Swiss companies surveyed by the central bank have been negatively affected by U.S. tariffs
• Nearly one-third of Swiss firms have taken no measures in response to the tariffs, suggesting a wait-and-see approach
• Swiss inflation remains at 0.1% in January 2026, at the bottom of the SNB's 0-2% target range, with inflationary pressures barely changed despite tariff uncertainty

RiverFront Investment Group views Kevin Warsh's appointment as Fed Chair as credible and pro-growth, expecting him to bring pragmatism and shake up Fed policy. The firm continues favoring technology investments but prefers hardware semiconductor companies over software-as-a-service (SaaS) stocks amid AI disruption. Despite recent market volatility from the Warsh appointment and tech sector concerns, RiverFront maintains a constructive market outlook.

• Warsh served as Fed Governor during 2006-2011, helped restructure banking during the financial crisis, and is expected to pursue pro-growth policies while challenging the Fed's reliance on quantitative easing and over-communication
• SaaS stocks face a 'SaaSpocalypse' as new AI models like Anthropic's Cowork threaten to replace existing software in financial and legal analysis, prompting preference for semiconductor 'picks and shovels' over AI model developers
• Mega-cap technology cash flows have significantly outpaced the broader S&P 500 over three years, and the firm views current market volatility as likely too brief to warrant tactical positioning changes

President Trump selected Kevin Warsh as the next Federal Reserve chair, a choice viewed as promoting central bank independence and credibility. Warsh, who served as Fed governor from 2006-2011, is expected to support modest near-term rate cuts but may tighten financial conditions if inflation runs above trend due to his monetarist principles. Markets responded with minimal rate pricing changes, lower front-end bond yields, and a stronger dollar.

• Interest rate markets still expect two additional 25-basis-point cuts this year starting in June or July, with pricing barely moving after the announcement
• Warsh's monetarist approach emphasizes money supply as inflation's primary driver and he has criticized bond-buying programs outside severe financial stress periods
• A Warsh-led Fed is expected to favor less market intervention, potentially creating opportunities from higher interest rate volatility and more patience during equity drawdowns

Despite early 2026 volatility from bond market stress and policy uncertainty, US equities reached new highs in January with market leadership broadening beyond mega-cap tech stocks. The S&P 500 Equal Weight Index outperformed the market cap-weighted index, while international developed equities, US small-caps, and emerging markets posted stronger gains. The Federal Reserve held rates steady, and President Trump nominated Kevin Warsh as the next Fed Chair.

• International developed equities led January with +5.8% returns, followed by US small-caps (+5.5%) and emerging markets (+5.1%), while the S&P 500 Equal Weight Index (+3.4%) outpaced its market cap-weighted counterpart (+1.5%)
• Consumer confidence fell to 84.5 in January, the lowest level since May 2014, while the Fed held rates at 3.50-3.75% with Core PCE inflation at 2.8%, above the 2% target
• Mid-cap and small-cap earnings growth is projected at 19% and 14% respectively for 2026, with the 'Magnificent Seven' contribution to S&P 500 earnings expected to decline from 44% to 34% in 2026 as the other 493 stocks increase their share to 56%

Corporate bond spreads in both investment-grade and high-yield markets have shown favorable seasonal patterns in January, with 2026 already exceeding historical averages. Investment-grade spreads have tightened 6 basis points versus a 4 bp historical average, while high-yield spreads tightened 10 bp versus a 16 bp average. However, spreads are entering 2026 near historic lows, potentially limiting further compression despite positive seasonal signals.

• January has historically been the third-best month for both IG and HY spreads since 1997, and years with January tightening typically show continued strength through year-end (IG averaging -8 bp vs +1 bp overall; HY averaging -51 bp vs flat).
• Current spread levels are exceptionally tight at approximately 74 basis points for investment-grade and 250 basis points for high-yield, near historic lows.
• While seasonal patterns suggest continued tightening, current rich valuations mean further compression may be modest, making strong economic fundamentals and policy support critical to maintaining current levels.