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Market Volatility
The S&P 500 suffered its worst monthly decline since March, driven by escalating geopolitical tensions, trade uncertainty, and AI disruption fears. Wall Street's quant playbook was upended as AI reordered market dynamics, with investors dumping tech quality for traditional value. US leveraged loans recorded their steepest monthly decline since 2022 as AI-driven fears deepened, with JPMorgan warning that up to $150 billion of CLO loans face disruption from the AI boom.
Oil & Energy
Oil prices climbed as Trump indicated no final decision on Iran, with crude heading for a 3% monthly gain. Hedge funds boosted bullish oil bets to a 22-month high on Iran risks, while US crude production fell to a six-month low of 13.7 million barrels per day in December. The Iran attack prompted Israel to shut down natural gas fields, raising concerns about energy supply disruptions across the Middle East.
AI Disruption
AI disruption concerns triggered a credit market selloff, with software debt slumping as investors worried about AI's impact on traditional business models. Anthropic's cyber launch was deemed not an existential risk to the sector by Bernstein, while Nvidia prepares a new inference processor amid rising competition. Europe lags the US in AI investment but stands to gain on productivity, according to UBS.
Banking & Credit
Bank stocks suffered another plunge on credit and AI fears, with consumer lenders among the worst performers. Royal Bank of Canada saw high-yield desk attrition after First Brands losses, while Apollo netted $250 million in paper profits on x AI debt. Wells Fargo upgraded Liberty Formula One on balanced risk-reward, highlighting selective opportunities in the sector.
Geopolitical Tensions
China called for an immediate ceasefire after US and Israel bombed Iran, while Rep. Auchincloss demanded clear rationale on Iran military actions. Pakistan and Afghanistan threatened war in a region eyed by superpowers, escalating tensions where economic giants vie for influence. The Pentagon cut ties with Columbia, Yale, Brown, and others accused of "wokeness" by Hegseth.
Corporate Moves
SpaceX is targeting a confidential IPO filing as soon as March, while CP Group plans to sell a 10% stake in True Corp. with UBS as main buyer. BlackRock and Goldman Sachs joined the race to fund Phoenix's pension business, with UK pension group noting all talks are in early stages.
Precious Metals
Gold capped a historic month with its best dollar gain ever in February, increasing 11% as investors sought safe havens amid market turmoil. Gold prices climbed, with spot gold set for a monthly gain of more than 8%, reflecting heightened risk-off sentiment across global markets.
Fixed Income
Treasuries enjoyed their best month in a year as investors flocked to safety. The dollar set for its first monthly gain since October amid geopolitical tensions and a hawkish Fed stance. Stablecoin demand could end 30-year Treasury auctions for three years, according to market analysts.
Private Markets
Berkshire's operating profit slid nearly 30% on insurance underwriting, while Blackstone chief Schwarzman received $1.2 billion in 2025 income from dividends. Greg Abel told Berkshire investors that cash holdings are not a retreat from dealmaking in his first shareholder letter after Warren Buffett's retirement.
Technology & Media
Netflix preserved its business model despite losing Warner to Paramount, while Paramount's $57.5 billion Warner debt will mix junk and high-grade ratings. Compass and Rocket partnered on a home listing initiative to expand visibility on Redfin's platform. DeepSeek plans to release a long-awaited AI model in a new challenge to US rivals, working with Huawei to cut reliance on Nvidia chips.
Regulatory & Legal
US forces are locked in air-defense battles, fending off attacks on American bases amid Iran fighting, according to an official. Former Moelis banker plans to plead guilty in a global insider trading case, returning from France to face charges. US court blocked a landmark law limiting social media use for children, ruling Virginia cannot restrict minors' access to constitutionally protected speech.
International Markets
China fundraising jumped as refinancing and bond issuance boomed last year, according to the National Bureau of Statistics. China and Germany strengthened strategic ties as Chancellor Merz visited Beijing. Argentina passed its biggest economic overhaul in decades, marking a libertarian win for market reforms.
Private Equity
Promotions & Hires
Sverica Capital promoted Michael Dougherty to partner and Doug Patrican to principal, while also bringing on Matt Johnson as a principal.
Fundraising
FS KKR Capital Corporation, the publicly traded private credit vehicle managed by KKR, reported increased troubled loans and lower fourth-quarter earnings.
Mega-Deals
BlackRock's GIP and EQT are in advanced discussions to acquire US power producer AES in a potential $12.4 billion takeover.
Industry Insights
PE Hub's NEXUS conference featured discussions on the "Goldman handful" phenomenon and challenges facing the private equity industry.
Sector Investment
Real Estate Leadership
La Caisse appointed a new European real estate asset management lead. The executive previously oversaw transaction activity at Legal & General.