The Dividend Cafe Thursday - February 12, 2026
Feb 12, 2026
A market reversal with big losses across major indexes and tech-led selling sets the scene. Falling long-term yields and a flattening curve get attention. Discussion covers upcoming CPI, jobless claims, and weak home sales. Themes include AI versus capex, record S&P margins, and differing equal-weight vs cap-weight dynamics. A debate about Fed leadership and political influence rounds out the conversation.
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Market Reversal And Cross-Currents
- Markets reversed from a morning rally into meaningful losses with tech leading the decline today. Brian Szytel highlights that long-term yields fell while the curve flattened, adding to the cross-currents driving volatility.
Conflicting Economic Signals
- Multiple economic signals are creating push-pull dynamics including positive manufacturing data and recent strong labor prints. New Federal Reserve leadership and debates over AI productivity and capex ROI further complicate market expectations.
Earnings Growth Priced In For 2026
- The market expects roughly 14% S&P earnings growth for 2026, implying about $310/share and a ~22x forward P/E. That sets the stage for volatility as margins and sector composition must justify those earnings assumptions.