MARKET RECAP

• US stocks -1.26%, international +1.67%, bonds +0.86%.
• The interest rate on the 10-year treasury dropped by 18 basis points to 4.04%.
• The January jobs report, released this past Wednesday, showed a surprising burst of hiring with 130,000 jobs added, nearly double what most economists expected. Most of the gain was in healthcare stocks. The unemployment rate also ticked down slightly to 4.3%, signaling a potential shift away from the stagnant “low-hire” environment of 2025. Total job growth for last year slashed from 584,000 down to just 181,000.
• The January CPI report released this past Friday showed that inflation slowed more than expected, with the annual rate dropping to 2.4% from 2.7% in December. On a monthly basis, prices ticked up just 0.2%, driven primarily by shelter costs, while being offset by a significant 3.2% drop in gasoline prices.
• The Nasdaq 100 has been moving sideways since October, small caps are in an uptrend, and the Mag 7 is showing some weakness. Money has been rotating into energy, industrials, materials, and staples.
• Dividend stocks have outperformed growth stocks since November.
• Software stocks have been pummeled and are up less than 5% over the last five years.

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