Monthly Review - February 2026
In brief
The markets
-0.9%
5.6%
3.7%
3.2%
3.0%
2.7%
6.7%
1.1%
10.4%
Source: Bloomberg 27.02.2026, returns in local currency
Top stories
Uncertainty churns the markets
US equity markets were buffeted by a succession of blows. The launch of a new AI tool by Anthropic wiped billions of dollars off the value of tech companies, at times indiscriminately. Rotation within stock market sectors was in full force. ‘Old world’ companies, such as manufacturers and supermarkets were in demand, and Walmart joined the exclusive list of companies valued above $1 trillion. Later, tariff volatility returned after the US Supreme Court ruled that President Trump's liberation day tariffs were illegal. The president ramped up trade tensions by imposing a new 15% tariff across the board, pushing gold higher and the dollar lower.
Between a rock and a hard place?
Markets evaluated the nomination in late January of Kevin Warsh as the next chair of the US Federal Reserve (Fed). It is hoped that his appointment in May might bring a return to discipline. He might even master the balancing act between the US administration’s demands for both lower interest rates and higher government funding. The minutes of the Fed’s January meeting made clear that US interest rates will likely be on hold ‘for some time’. Meanwhile, rumours circulated that Christine Lagarde looks set to leave the top job at the ECB (European Central Bank) earlier than planned.
Enter the all-purpose AI agents
It was described as a “breakout moment”, as Anthropic launched a succession of AI tools to rival OpenAI’s most powerful model ChatGPT-5.3. These so called all-purpose agents are designed to be used by any office worker, possibly yielding significant productivity gains. Data enterprise software companies took a hit, as did advertising companies, finance and law firms, as analysts revised down revenue forecasts for ‘software as a service’ (SaaS) products that might be rendered non-essential overnight. Meanwhile, at the AI Impact Summit in India, world leaders called for global AI cooperation, with any growth opportunities shared more equally across the world.
Falling carbon emissions in China
The US is rolling back climate regulation – most recently, by rescinding the Environmental Protection Agency’s 2009 “endangerment finding” that underpins federal greenhouse gas limits. In stark contrast, in the final quarter of 2025, China’s carbon emissions fell compared to a year ago, extending a 21-month “flat or falling” trend. Emissions fell across transport, power, cement and metals. Meanwhile, clean power generation continued to grow faster than overall electricity demand, with increases in solar, wind and nuclear cutting coal generation by 1.9%.
On the radar
Ongoing hostilities between the US and Iran will likely add to geopolitical uncertainty and could put pressure on markets if the conflict broadens or disrupts energy supply routes.
After the Supreme Court invalidated Donald Trump’s reciprocal tariffs, the US president unveiled blanket 15% tariffs on all imports entering the US. This has reignited uncertainty around US trade policy and the future of bilateral trade deals signed with Washington’s trading partners.
March is a busy month for China, with Premier Li Qiang opening the 14th National People’s Congress, which includes reviewing the 15th Five-Year Plan (2026–2030). US President Trump is also expected to meet with Chinese President Xi Jinping.