📈 The Week Ahead (February 12, 2026): Market Insights from HPK Provident Advisors
Through Thursday, we received several pivotal economic data points—but the real question is whether they can be fully trusted.
January nonfarm payrolls came in at approximately 130,000, with private payrolls running even stronger. So why the skepticism? After revisions, we learned that the monthly average job growth for 2025 was just 15,000. That raises an important question: why such a sharp jump to begin the new year?
Seasonal adjustments likely played a role. I often mention that January can be a peculiar month for labor data. If layoffs do not materialize at typical seasonal levels, the adjustment factors can artificially boost the headline number. Additionally, healthcare accounted for more than half of the jobs added in January. While the report will likely still be viewed as solid, I would not be surprised to see future revisions bring that figure closer to 85,000.
Retail sales, on the other hand, reflected some softness in consumer spending. That sets the stage for tomorrow’s inflation report, which could ultimately determine whether the market breaks higher or lower in the near term.
At this point, the S&P 500 is shaping up for a weekly loss. Additional downside would break an ascending triangle pattern, potentially accelerating selling pressure. We have initial support near 6,800, which coincides with the 100-day moving average. If that level fails, 6,550 appears to be the next major support zone.
While the market-cap-weighted index has struggled to start the year—driven largely by weakness in the “Mag 7” and software—the diversified portfolio is holding up considerably better. Value, international, and small-cap equities have all posted stronger relative performance. Emerging markets, in particular, remain attractive on an intermediate-term basis, though they may be somewhat extended in the short run.
The longer-term outlook for international equities will depend heavily on the direction of the U.S. dollar. A sustained breakdown in the dollar—something I view as increasingly likely—could provide additional support to both emerging markets and the broader commodity complex. I am somewhat more cautious on the value segment, as I expect economic growth to slow outside of a few select areas of the economy and consumer sector.
We should soon have greater clarity on the market’s direction. The inflation data released on the 13th will be a critical driver. My base case remains lower employment growth coupled with sticky inflation during the first half of the year.
We will cover the CPI report during our Friday Live broadcast this week on YouTube. We will also discuss the preliminary Q4 GDP reading and the Core PCE deflator (the Fed’s preferred measure of inflation).
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Disclaimer
The opinions expressed in this material are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual. All performance referenced is historical and does not guarantee future results. All indices are unmanaged and cannot be invested in directly. Economic forecasts may not develop as predicted.