Stocks, Silver Got Rocked Lower Thursday; Friday the 13th Setting Up for Volatile Session; January CPI Reported at 2.4% Annually

Thursday morning, Money Daily noted that trading in stocks was sluggish and that the major indices were becoming very tempting to short.

It didn't take long for markets to confirm the timeliness of the observation. All three majors jumped higher out of the gate, but quickly reversed course, the NASDAQ needing just 15 minutes to dip into the red, where it remained the rest of the day. The Dow and S&P followed suit, as the indices got back to the kind of volatility that had been typical for most of the year thus far.

The financial press trotted out the usual suspects for the declines: fears of AI disruption to labor markets and geo-political conditions. What they failed to mention were the number of companies producing fourth quarter 2025 numbers that were disappointing or questionably negative 2026 forecasts. This earnings season has been one of the most challenging in years, companies in nearly all sectors outside of tech and large-cap industrials have been beset by underlying forces of tariffs, supply chain concerns, and lack of pricing power in the face of stretched consumer budgets.

Factset reported last week that with 59% of all S&P 500 companies reporting, 76% have reported actual EPS above estimates, which is below the 5-year average of 78%. The report also shows that all sectors other than information technology and communications services are showing single digit revenue growth. The report fails to account for the number of companies issuing unfavorable guidance or EPS and/or revenue that failed to beat prior quarter or year-ago results, of which there are many.

While Wall Street hustlers continue to herd the public into a false sense of security, insiders and executives have been taking profits, selling off their own shares while having the company buy back shares, effectively boosting EPS by lowering the number of shares outstanding. It's a trick Wall Street has been employing for the past two decades, hiding the fat that many of the high-flying stocks have gotten rich not by expanding their businesses or investing in CapEx or research, but by limiting the number of shares available to the public, which has pushed individual stocks and the general indices to record highs over and over again.

Thursday's rout now on the back-burner of some very short memories, the BLS released January CPI Friday morning, delivering a much-needed dose of disinflationary information. Month-over-month, CPI increased only 0.2% and 2.4% on an annual basis, down from 2.7% in December. This should come as welcome news to the crowd favoring rate cuts, as they can now claim inflation is close enough to the Fed's 2.0% target that inflation concerns can be put aside, making way for further cuts to the federal funds target rate to boost the economy.

Arguing for rate cuts as a way to improve economic conditions is close to, but not entirely, an admission the the U.S. economy is not 100% or the "hottest" on the planet, according to President Trump. Consumers are strapped and need relief in the form of lower prices, though what's addressed in the CPI fails to include much of the hidden costs of 21st century living, like property taxes, insurance, and health care, all of which have been skyrocketing of late.

Like clockwork, stock futures ripped higher on the CPI announcement, though the move only served to take futures out of the red and briefly into positive territory, a very unconvincing bump. about 45 minutes prior to the opening bell, Dow futures stood at -19; NASDAQ futures, -19; S&P futures, -7.

Silver was punished for being a valuable asset on the COMEX, Thursday with the price of an ounce down more than 10%, "selling" for as low as $73.86. Not coincidentally, Chinese New Year is underway, with the Shanghai Gold Exchange (SGE) and Shanghai Futures Exchange (SHFE) closed from February 13 to the 20th. Anybody considering stocking some precious metals might find this an opportune time to do so, as prices for physical are nowhere near the paper prices pumped by the COMEX and LBMA riggers. Good luck finding shiny close to spot prices. Dealers are reporting shortages and long lead times. The U.S. mint isn't selling any silver one-ounce coins for less than $169, which is more than double the spot price. Yes, that is odd.

For the week, through Thursday's close, the Dow is down 663 points, the NASDAQ is off 434, and the S&P is down 99.

Stocks reporting Thursday after the close included:

• Pinterest (PINS) - revenue miss, weak guidance, shares down 22% pre-market
• Coinbase (COIN) - net loss, 20% lower revenue, shares up 7%
• DraftKings (DKNG) - forecast short of estimates, stock down 15%
• Applied Materials (AMAT) - upbeat outlook, demand from AI, shares up 10%
• Expedia (EXPE) - earnings beat, shares down 5%
• Dutch Bros. (BROS) - strong quarter, expansion plans boost shares 15%

Friday, before the open:

• Wendy's (WEN) - slaes down, stock down 4%
• Advance Auto Parts (AAP) - sales growth, positive forecast, shares up 10%
• Moderna (MRNA) - narrows loss, reiterates growth target, sheas higher by 4%

Bombing Iran shortly after the close a distinct possibility.

At the Close, Thursday, February 12, 2026:
Dow: 49,451.98, -669.42 (-1.34%)
NASDAQ: 22,597.15, -469.32 (-2.03%)
S&P 500: 6,832.76, -108.71 (-1.57%)
NYSE Composite: 23,188.82, -290.90 (-1.24%)