2nd Month Lower in Last 12

March 2, 2026

January was the 9^th positive month in the last 10 for the market.  We know trees do not grow to the sky and with February being a historically non-descript month for the market, we wondered if it might be a place where we would see some profit taking.  Artificial Intelligence (AI) has been driving the market and while we expect the trend to continue, valuations have become extended.  Early in the month we did see some market weakness, but not because of doubts about AI, but about concerns of what AI might do to other segments of the economy, particularly the software space.  There was also concern about the debt companies are taking on to fund AI. Those concerns created selling pressure mid-month that sent the S&P 500 to the lowest level this year. We continued to get a plethora of corporate earnings reports with 75% above expectations and the S&P 500 moved in and out of positive territory.  At month end the S&P 500 had lost .9% and is now up .5% for the year.   This was only the second down month in the last year for the widely followed index.  The NASDAQ saw most of the selling and ended the month down 3.4%.  Concerns about an attack on Iran sent oil prices another 3% higher and gold continued its rally gaining more than 10%. Interest rates moved lower with mortgage rates hitting a 4-year low.

 

The month began with a plunge in the prices of both bitcoin and gold. In addition, we began to see the first concerns about AI disruption which sent the software ETF down 6%.  By Thursday, the NASDAQ 100 had dropped by over 1000 points, but a rebound in bitcoin on Friday helped stabilize the market and the S&P 500 ended the week with a loss of just .1%, while the tech heavy NASDAQ shed 2%.  The second week saw a continued rotation from growth to value that pushed the 30 stock Dow Indutrial average to an all-time high and above 50,000 for the first time. The NASDAQ tried to rebound, but near week’s end concerns about AI debt sent the index sharply lower and the S&P 500 ended the week down 1.4%. The third week was shortened by the President’s Day holiday and a rebound in tech stocks gave the market a better tone.  At week’s end the Supreme Court ruled Trump’s tariffs were beyond his authority which lifted the market and the S&P 500 ended with a gain of 1.1%.  The final week the market dealt with Iran uncertainty, tariff concerns, and the State of the Union, but the headline news was earnings from Nvidia.  Nvidia is the most important company right now because the future is AI and Nvidia is the most important company in that space.  Wednesday night they did what they have done for 2 years, reported revenue and earnings above expectations with strong guidance.  However, because the stock had rallied 14% in the 2 weeks ahead of earnings, the report was seen as an opportunity to book profits, and many tech stocks were caught up in the selling.  On the last trading day of the month, we learned January wholesale prices advanced at a stronger pace than expected and that cemented a down month.  The S&P 500 was down .4% for the week.

 

March has been an average month for market performance, closing higher roughly 60% of the time.  Corporate earnings reports will wind down so our focus will be elsewhere.  The market will continue to be influenced by tariff issues, AI debt and disruption concerns and geopolitical concerns.  Valuations continue to be above historic norms, but the selloff in the tech space has helped bring that important sector to a more reasonable price to earnings ratio.  We have been focusing on things that can go wrong, but there are several things that should go right.  The economy continues to be solid which is driving corporate earnings, the next move in interest rates is likely lower, AI advances and spending will continue, and we are expecting to see record refunds from Trump’s tax bill.  A 5% to 10% “correction” can come at any time for many reasons, but we would be buyers of a tradeable dip.

 

If you know someone who would be interested in learning more about Greenberg Financial Group or taking advantage of our complementary financial plan, please contact us at 520-544-4909, or visit our website at www.greenbergfinancial.com. As always, the key to successful investing is to have a portfolio that is consistent with your investment objectives and risk tolerance. We invite you to listen to our weekly Money Matters radio show which airs every Sunday Morning from 8:00 AM to 10:00 AM on KNST AM 790.  Previous shows are available on the iHeart app, our website, or your favorite podcast platform.  Simply type “Money Matters with Dean Greenberg”.