US Markets
Stocks climbed in February as investors cheered continued disinflationary trends, solid corporate earnings, and a resilient economy.
- The Dow Jones Industrial Average gained 2.2%.
- The S&P 500 rose 5.1%, marking its fourth consecutive monthly gain.
- The Nasdaq Composite surged 6.1% as tech stocks led the charge.¹
Fed Holds Steady, Markets React
The Federal Reserve’s January decision to leave interest rates unchanged set the tone for February.
Markets initially wavered as investors parsed Fed Chair Jerome Powell’s cautious comments, which hinted at rate cuts later in the year but emphasized the need for more economic data.²
However, as economic reports showed cooling inflation without significant labor market weakness, investors regained confidence that the Fed could engineer a “soft landing.”³
Inflation and Economic Growth Remain in Focus
The January Consumer Price Index (CPI) report, released in mid-February, showed core inflation (excluding food and energy) rose 3.8% year-over-year, slightly above expectations but trending lower.
The Producer Price Index (PPI) also pointed to easing price pressures.⁴,⁵
At the same time, the economy continued to show strength, with Q4 GDP growth revised upward to 3.3%, reinforcing investor optimism.⁶
Tech Stocks Shine
The technology sector was the standout performer in February, with strong earnings from major companies like Nvidia, Microsoft, and Meta fueling market momentum.
The rise of artificial intelligence (AI) continued to dominate headlines, pushing semiconductor and cloud computing stocks higher.⁷
Global Markets
The MSCI-EAFE Index climbed 4.8%, with European markets posting solid gains:
- Germany rose 6.5%.
- France gained 5.3%.
- The UK added 3.9%.⁸
In Asia, Japan’s Nikkei 225 surged 7.2%, reaching a multi-decade high as corporate reforms and a weaker yen attracted foreign investment.
However, China’s markets remained under pressure, with ongoing real estate concerns and weak consumer sentiment dampening investor enthusiasm.⁹
The Road Ahead: March Outlook
With no Fed meeting scheduled in March, investors will closely monitor key economic data releases, including the next CPI report and labor market trends.
The debate over potential rate cuts later in 2025 is likely to drive market sentiment.
Additionally, geopolitical events and US election-related policy discussions may introduce new variables into the market equation.
For now, markets remain optimistic, but investors will be watching for any signs of economic slowdown or inflation resurgence.
Our blog posts are intended for information purposes only and should not be interpreted as financial advice.
You should always engage the services of a fully qualified financial planner before entering any financial contract.
To discuss engaging the services of Fortitude Financial Planning please email us at info@fortitudefp.ie.
Fortitude Financial Planning Ltd will not be held responsible for any actions taken as a result of reading these blog posts.
Production