Market Wrap Summary - February 17, 2026

Overview

European indices showed a positive trend despite a weaker performance on Wall Street. The major indices, including the FTSE, DAX, and CAC40, recorded modest gains, particularly in the commodity sector. In contrast, U.S. index futures indicated a lower opening, with the US500 and US100 down approximately 0.1% to 0.3%.

Economic Indicators

Germany's ZEW economic sentiment index fell short of expectations, while the euro area sentiment also showed a slight decline compared to the previous month. Key economic data included:

• Germany's ZEW Economic Sentiment: 58.3 (Forecast: 65.2, Previous: 59.6)
• Germany's ZEW Current Conditions: -65.9 (Forecast: -65.9, Previous: -72.7)
• Eurozone ZEW Expectations Index: 39.4 (Previous: 40.8)
• Germany's CPI Inflation: 2.1% y/y increase, -0.1% m/m drop (in line with expectations)
• UK Labour Market: Unemployment rate rose from 5.1% to 5.2%, with a decline of 11k jobs (expected drop of 20k).

Market Performance

In the commodities market, silver prices fell over 2%, while gold retreated by 1% to USD 4,930 per ounce. The cryptocurrency market also displayed weakness, with Ethereum trading below USD 2,000 and Bitcoin consolidating around USD 68,000.

Investor Sentiment

The latest Bank of America Fund Manager Survey for February 2026 indicates that global investors remain "decidedly bullish," although the potential for further asset price increases in Q1 appears limited. Key findings from the survey include:

• Commodity overweight at the highest level since May 2022.
• Equity overweight at the highest level since December 2024.
• Most optimistic outlook on corporate earnings since August 2021, yet a record number of investors believe companies are "overinvesting."
• Concerns about an AI bubble bursting as the top tail risk.
• Long positions in gold are the most crowded trade.
• Record shorts in the U.S. dollar, reflecting the most bearish stance since 2012, driven by a narrative of de-dollarisation and dovish expectations for the Federal Reserve.

Despite the bearish sentiment, there is potential for a rebound in the dollar in 2026, particularly if the U.S. labor market improves or if other major central banks adopt more dovish stances in response to weakening macroeconomic data.