As we navigate through 2026, the investment landscape is becoming clearer. Energy, basic materials, and defensive consumer stocks are currently in favor, while technology and financial sectors are experiencing a downturn. This observation stems from recent trends in US equity sector ETFs, reflecting investor sentiment as of February 10.
Currently, the economic narrative seems obscured, akin to trying to view a scene through fogged glass. Depending on which indicators you choose to emphasize, one could argue multiple interpretations of reality. While forecasts are generally subject to uncertainty, the present situation feels particularly elusive, as key figures appear to mask the underlying story.
The alternative energy sector made substantial gains last year, significantly outpacing shares of Big Oil. This shift towards clean energy caught many analysts off guard, especially given the Trump administration’s known support for fossil fuels. However, in recent days, Big Oil has begun to regain momentum after underperforming in 2025. This raises a critical question: Was last year’s surge in alternative energy simply a temporary trend?
● The Doom Loop: Why the World Economic Order Is Spiraling into Disorder
Eswar Prasad
Review via The Economist
In this compelling book, Prasad argues that shifts in the global balance of power—with the ascent of China and India and the decline of Western dominance—are reshaping the world economy into a chaotic system. What once might have opened doors for stability now seems to foster destructive feedback loops connecting economics, domestic politics, and geopolitics.
Bitcoin has captured headlines once again following a significant drop last Thursday, briefly falling below $61,000. This represents a decline of over 50% from its previous peak in October, when it soared to an all-time high of $126,000.
Provided there are no further disruptions in the federal government’s erratic schedule, the long-awaited fourth-quarter GDP report is due for release in two weeks (February 20). Initial expectations suggest that it will show a softer yet resilient expansion for the last quarter of the previous year, drawing from the median forecasts available through The Capital Spectator.
Three weeks ago, I questioned whether the current trend favoring small- and micro-cap stocks would continue. Past experiences have shown that such leadership can be fleeting, as large-cap and growth stocks often regain the spotlight after small-cap surges. The argument for a sustained shift this time remains tenuous; nevertheless, small-cap stocks continue to demonstrate strength based on a set of equity risk factor ETFs as of February 3.
In January, the long-term return forecast for the Global Market Index (GMI) remained stable at over 7%, while the benchmark’s trailing 10-year returns surged above 10%. The nearly three-percentage-point disparity between these figures is strikingly wide, suggesting that investors may need to recalibrate their performance expectations for globally diversified portfolios moving forward.
In January, commodities and international stocks emerged as the strongest performers among major asset classes, according to a range of ETF proxies. Additionally, assets located overseas benefitted significantly from a weaker dollar, allowing them to outperform their US counterparts by a sizable margin.
● It’s on You: How Corporations and Behavioral Scientists Have Convinced Us That We’re to Blame for Society’s Deepest Problems
Nick Chater and George Loewenstein
Summary via publisher (Basic Venture)
This compelling book outlines how the principles of behavioral economics have been wielded by governments to address significant societal issues, from retirement planning to climate change, through gentle nudges. However, authors Nick Chater and George Loewenstein demonstrate that such strategies are rarely effective and often detract attention from necessary policy changes. For instance, encouraging a shift to green energy through nudges fails to significantly reduce carbon emissions and sidesteps the profound challenge of establishing a low-carbon economy.
