Market Analysis Summary - February 18, 2026

Key Highlights

• SP500 gains ground as traders focus on economic reports.
• NASDAQ rallies as traders bet on a rebound in software stocks.
• Dow Jones attempts to settle above the 50 MA at 49,839.

SP500 Performance

The SP500 is moving higher, driven by better-than-expected housing market data. Housing Starts increased by 6.2% month-over-month in December, and Building Permits rose by 4.3%, both surpassing analyst expectations. Additionally, the Durable Goods Orders report showed a decrease of only 1.4% month-over-month in December, better than the anticipated 2% decline. The Industrial Production report also supported the SP500, indicating a 0.7% month-over-month increase in January, exceeding the 0.4% consensus.

Basic materials stocks saw significant gains, buoyed by a rally in precious metals, while energy stocks benefited from rising oil prices due to geopolitical tensions. Conversely, consumer defensive, real estate, and utilities sectors declined as Treasury yields increased, reducing demand for safe-haven assets.

The SP500 has moved above the resistance level of 6870-6880 and is attempting to settle above the 50 MA at 6900. A successful settlement could lead to a target range of 6940-6950.

NASDAQ Index Insights

The NASDAQ index tested new highs, driven by rising demand for tech stocks, particularly software companies like Shopify and Applovin. Traders are optimistic about a rebound in software stocks following a significant sell-off attributed to AI-related concerns. Some investors are looking for strong players in the sector, indicating a potential dip-buying opportunity.

The NASDAQ is currently trying to settle above the 50 MA at 24,966. If successful, it could target the resistance levels of 25,200-25,250 and potentially 25,600-25,650.

Dow Jones Analysis

The Dow Jones index gained some ground amid a broad equity market rally but struggled to maintain momentum due to declining demand for defensive sectors. Notable losers included Walmart and Procter & Gamble, pressured by rising Treasury yields affecting dividend stocks. However, Amazon and NVIDIA saw gains due to increased interest in AI-related stocks.

Technically, the Dow Jones has moved above the resistance level of 49,500-49,600 and is attempting to climb above the 50 MA at 49,839. A successful settlement above this level could lead to a target range of 50,100-50,200. Conversely, a drop below 49,500 could push the index towards recent lows near 49,200.

Conclusion

The market is currently experiencing a mixed sentiment, with the SP500 and NASDAQ showing positive momentum driven by economic data and sector-specific rallies, while the Dow Jones faces challenges from rising yields and sector rotations. Traders are advised to monitor key resistance levels and economic indicators for potential market movements.