Economic Update | Feb 12, 2026
Hosted by Andrew Toccaceli, RICP®, MRFC® and Coley Neel, CFA® | W.A. Smith Financial Group
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January marked the beginning of a new year and a natural reset for markets after a strong finish to 2025.
As expected, the start of 2026 brought a bit more movement beneath the surface, with investors adjusting to changing interest rate expectations and shifting market leadership.
While volatility picked up at times, particularly among some of the largest technology stocks (i.e., Magnificent 7), the broader market backdrop remained constructive, and we witnessed an increase in overall breadth.
Economic data continues to show resilience, earnings results are generally in line with expectations, and market activity is reflecting more of an adjustment rather than deterioration.
From an economic standpoint, the Federal Reserve’s decision to pause additional rate cuts reinforced a message of patience and confidence in the economy’s ability to continue growing without overheating.
Inflation has continued to ease, real wages remain positive, and the labor market, while cooling modestly, remains healthy by historical standards.
These trends have helped support a gradual normalization in interest rates (i.e., steepening yield curve) and encouraged broader participation across sectors and styles, which further solidifies why diversification remains so important during periods of transition.
As we move further into 2026, our focus remains on staying disciplined, flexible, and grounded in long-term strategy rather than short-term headlines.
We continue to actively monitor market conditions and make thoughtful adjustments when appropriate, always to manage risk and capture opportunity.
As we have discussed in the past, we remain focused on our rigorous 5-step due diligence framework and will continue to make investment decisions based on sound fundamentals and financial strength.
At the end of the day, our mission remains simple: to provide clarity, consistency, and Financial Peace of Mind, regardless of what the markets may bring.
We hope that you are having a great start to 2026, and we look forward to seeing you soon.
