Market Update – February 23rd, 2026

Sound Planning Group Team

Financial Markets

Stocks rose last week despite weaker-than-expected GDP, sticky inflation, and a Supreme Court decision striking down many of President Trump’s tariffs. As of Friday’s close, the Nasdaq Composite gained 1.28%, the S&P 500 advanced 1.12%, and the Dow Jones Industrial Average rose 0.35%, reversing the prior week’s trend of the value-heavy Dow outperforming the major indexes. Early Monday trading has turned more cautious, as concerns around tariff developments have pushed major indexes modestly into the red.

Market News

Tariffs Struck Down by Supreme Court. Friday morning brought a long-awaited Supreme Court decision on the legality of several tariffs imposed by President Donald Trump. In a 6–3 ruling, the Court struck down the sweeping tariffs enacted through a series of executive orders. The decision did not address whether, or how, the federal government should provide refunds to importers that previously paid the tariffs.

Later that day, President Trump expressed disagreement with the ruling during a press conference and announced a new executive order imposing a 10% global tariff, which was later raised to 15%. Markets were largely unfazed by the developments last week, with the S&P 500 rising 0.69% on Friday.

PCE Inflation. The Federal Reserve’s preferred inflation gauge ticked higher in December, with headline PCE rising to 2.9% year over year and core PCE increasing 3.0% from a year ago. On a monthly basis, both measures advanced 0.4%, a firm reading that underscores the persistence of price pressures.

Markets had anticipated a modest uptick, but the data does little to strengthen the case for near-term rate cuts when policymakers meet in March. Fed funds futures are currently pricing in just a 6% probability of a cut next month, and expectations have shifted toward June at the earliest for the next move lower.

Source: Y-Charts

Personal Income, Spending, & Saving. Personal income rose 0.3% in December, and personal spending increased 0.4%, marking another month in which consumption outpaced income growth. As a result, the personal saving rate declined to 3.6%, extending a gradual downward trend. The data reflects stable household income and spending, though the continued decline in the savings rate is a notable trend to monitor. 

Source: US Bureau of Economic Analysis

Fourth Quarter GDP Falls Short of Estimates. Q4 real GDP grew 1.4%, well below expectations that had been closer to 3%. The primary drag came from a sharp decline in government spending, largely tied to the record-breaking government shutdown. Lower exports also weighed on growth during the quarter.

Consumer spending remained a source of strength, though it decelerated from the third quarter. Business investment accelerated in Q4, helping to offset some of the weaknesses and prevent an even softer headline reading.

The fourth quarter appears quite distorted by the shutdown, but the slowdown in headline growth remains critical to watch, given the significant role government spending plays in overall U.S. economic momentum.

Source: US Bureau of Economic Analysis

Leading Indicators. The Conference Board’s Leading Economic Index declined again in December, extending its prolonged slide. Although the index’s rate of change no longer signals a recessionary trend, the headline level continues to drift lower due to weakness in several components.

In December, softer consumer expectations for business conditions, a decline in the ISM New Orders Index, and reduced average weekly manufacturing hours weighed on the reading. On the other hand, strength in building permits, equity market gains, and a less inverted yield curve provided partial offsets. Overall, the LEI continues to send a cautious signal, though current economic data indicates the index may be proving to be less reliable in this cycle than it has historically.

Source: The Conference Board

Summary

Stocks advanced last week despite softer fourth quarter GDP, firm inflation data, and a Supreme Court ruling striking down several executive branch-imposed tariffs, with major indexes finishing the week higher. Economic data reflected a mixed backdrop as PCE inflation remained elevated, income growth trailed spending and pushed the savings rate lower, GDP was restrained by reduced government spending tied to the shutdown, and the Leading Economic Index continued to signal caution even as broader activity remains relatively stable.

In closing, we want to express our sincere gratitude to our valued readers and loyal customers for entrusting us with your financial well-being. Your continued support is the cornerstone of our success, and we are committed to serving you with the utmost dedication and professionalism. As we navigate the ever-changing financial landscape together, we encourage you to reach out to us if there have been any shifts in your risk tolerance or if you have experienced any material changes in your Investment Policy Statement objectives or constraints. Your financial goals are our top priority, and we are here to adapt and tailor our strategies to align with your evolving needs, whether they pertain to risk and return objectives or constraints such as time horizon, taxes, liquidity needs, legal issues, unique circumstances, or changes in your financial planning and retirement objectives. Your feedback and communication are essential in helping us ensure your financial success. Thank you once again for your trust and partnership with Synergy Asset Management. We look forward to continuing this journey together.

We appreciate your continued trust.

Joseph M. Maas, CFA, CFP®️, ChFC, CLU®️, MSFS, CVA, ABAR, CM&AA, CCIM

Chief Investment Officer, SPG Advisors

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