Market Thoughts: Life moves pretty fast

There’s art in telling a well-crafted story. Investors, at the turn of a tale, spring on it. That’s very much the case when markets are expensive. Even more so when the central plot line that’s been driving them higher is suspect. Greed can quickly turn to fear. Things get jumpy.

That’s been the backdrop for the S&P 500 since October. We’ve bounced around quite a bit since then, but the biggest drawdown over that time period’s been about 5%. A flesh wound at the index level, to borrow a line from Monty Python. That’s certainly not the case on an individual stock basis. The U.S. equity market continues to ‘ferociously’ trade flat.

Creative destruction stems from innovation. It’s the speed associated with it that determines the difference between a protracted transition and something more vicious. The former, digestible. The latter, shock and awe. Competition can be cruel.

Agentic proficiency is moving faster than many expected. Tea leaf reading of unbounded productivity gains have yet to materially be measured. AI application adoption is weighing on hiring selectively. It doesn’t appear to be driving significant layoffs. Less hiring, little firing. But job displacement is coming.

Disruption is inevitable. It’s tough to refute. With uncertainty swirling, it will take time for investor nerves to settle. AI disruption has a long tail to it; discerning ultimate winners and losers is unclear. It’s why the biggest players are ‘all-in’ on capex. They can’t afford not to be. In particular, if there are just a few material winners in the end. Today that’s unknown.

Market narratives influence perspective, emotion and the perception of opportunity. Also, risk. Nvidia’s strong revenue, margin and earnings prints—along with strong first-quarter guidance—make for an interesting observation about how uncertainty continues to swirl.

‘Doomerism,’ for lack of a better phrase, is headline-hustling fearmongering. It helps anyone trading the short side of a market. Markets wobbled on Nvidia’s good news because investors recognized a few things. First, risks from AI disruption are broadening. They need to be better priced in.

Second, valuations have come down from highs across the tech sector. That doesn’t make them inexpensive, just less expensive. Pockets of tech feel oversold. That said, an imminent market sprint higher seems doubtful. Animal spirits are dormant, not yet ready for spring.

If Nvidia’s beating expectations on topline growth and operating leverage couldn’t give investors a pick-me-up, lingering doubts around AI disruption and displacement will keep things bouncy. Bad news sells better than good.

Investors continue to hound ‘coherent’ narratives – bullish and bearish alike. There’s dynamic tension when it comes to coercing—with consistency—current market direction. My sense is we’re caught on this hamster wheel a while longer. Frustration, like wheels on a bus, going round and round.

Markets are driven by people. People are impatient, twitchy, emotional. That ultimately creates investment opportunity. Steady hands prevail. Life moves pretty fast… so do markets.

“Life moves pretty fast. If you don’t stop and look around once in a while, you could miss it.” Ferris Bueller (Matthew Broderick), Ferris Bueller’s Day Off. 

Unless explicitly stated otherwise, all data is sourced from Bloomberg, Finance LP, as of 02/26/26.

Opinions, estimates, forecasts, and statements of financial market trends that are based on current market conditions constitute our judgment and are subject to change without notice. We believe the information provided here is reliable but should not be assumed to be accurate or complete. The views and strategies described may not be suitable for all investors.