Macro View - February 24, 2026 (EOD)

 ## Macro Summary Markets rallied broadly today, buoyed by easing fears around AI disruption and a more constructive outlook on trade tensions following the Supreme Court’s tariff ruling. The S&P 500 climbed 0.72%, the Nasdaq 100 surged 1.10%, and the Dow Jones rose 0.76%, reflecting renewed investor confidence in technology and cyclical sectors. The relief rally was particularly pronounced in AI-related stocks, with semiconductor and software names leading gains amid optimism about continued AI infrastructure buildout and partnerships, such as AMD’s multibillion-dollar deal with Meta. However, the backdrop remains complex as geopolitical and trade uncertainties persist. The Supreme Court’s decision to limit the Trump administration’s tariff authority has injected some clarity but also raised questions about the future of U.S. trade policy. Meanwhile, President Trump’s upcoming State of the Union address is expected to emphasize economic strength but may also introduce new policy risks. This combination of factors has created a cautious but constructive tone, with investors balancing growth prospects against policy and regulatory uncertainties. Commodity markets showed mixed signals, with oil prices edging lower amid ongoing concerns about U.S.-Iran nuclear talks, while gold and silver declined on expectations that the Federal Reserve will maintain current interest rates for an extended period. The dollar held steady, supported by trade uncertainty, which in turn weighed on precious metals. Overall, the macro environment continues to be shaped by the interplay of AI-driven growth optimism, trade policy developments, and cautious central bank guidance. ## Economic Data Reaction - **Consumer Confidence (February):** Slight increase - Markets interpreted the uptick as a sign of resilient consumer sentiment, supporting the equity rally despite lingering inflation concerns. ## Fed & Central Banks Fed officials, including Governor Collins and President Goolsbee, reiterated expectations that interest rates are likely to remain on hold "for some time," reflecting a cautious approach amid steady job market conditions and inflation that remains above target. This dovish stance helped underpin risk appetite, as investors priced in a prolonged pause in rate hikes. Comments also highlighted the Fed’s cautious deployment of AI technology internally, signaling an awareness of AI’s broader economic impact but a measured policy response. ## Rates & Bonds - 20+ Year Treasury (TLT): $89.96 (+0.25%) - 7-10 Year Treasury (IEF): $97.43 (-0.01%) - 1-3 Year Treasury (SHY): $83.05 (-0.01%) Long-duration Treasuries saw modest gains, reflecting some safe-haven demand amid trade and geopolitical uncertainties. The slight flattening in the yield curve suggests investor caution about longer-term growth prospects, even as short-term rates remain anchored by Fed guidance. ## Currency & Dollar The U.S. dollar index (UUP) edged up slightly to $27.11 (+0.07%), supported by ongoing trade uncertainty and safe-haven flows. Dollar strength exerted downward pressure on gold and silver prices, while also tempering gains in multinational equities. Asian currencies showed mixed reactions as markets reopened, reflecting cautious optimism about trade developments but lingering concerns over tariff risks. ## Commodities Wrap - Oil (USO): $80.37 (-0.66%) – Oil prices retreated slightly amid cautious sentiment ahead of U.S.-Iran nuclear talks and the OPEC+ meeting, despite geopolitical tensions supporting a near seven-month high. - Gold (GLD): $473.31 (-1.66%) – Gold fell for a second consecutive day on prospects of a prolonged Fed rate hold and a firmer dollar. - Silver (SLV): $78.96 (-2.00%) – Silver declined more sharply, pressured by the dollar and weaker industrial demand outlook. - Natural Gas (UNG): $11.44 (-2.56%) – Natural gas prices dropped amid thinner trading volumes and warmer weather forecasts. ## Global Markets Close - Europe: European equities closed mixed to slightly lower, weighed down by trade uncertainty and AI disruption fears, despite some sector-specific gains in energy and industrials. - Asia setup for tonight: Asian markets are poised for a mixed open, with China reopening on a strong note supported by tariff relief hopes, while tech-heavy markets like Hong Kong face pressure from AI-related selloffs. ## Tomorrow's Macro Focus Key focus will be on the upcoming Nvidia earnings report, which is expected to set the tone for AI sector sentiment given the company's leadership in AI chip technology. Additionally, investors will monitor President Trump’s State of the Union address for any new policy signals, particularly regarding trade and tariffs. Economic data on crude oil inventories and further developments in U.S.-Iran nuclear negotiations will also be closely watched for their impact on energy markets and broader risk sentiment.