It was a tale of two markets last week: Industrials surged while financial and tech names buckled under the growing weight of artificial intelligence fears. A mixed bag of economic data complicated matters further. Although the S & P 500 bounced slightly Friday following an inflation print that bolstered the future case for lower interest rates, it wasn’t enough to pull the index into the green for the week — or to convince investors that a Federal Reserve rates cut is coming next month. The S & P 500 shed 1.4% for the week, while the tech-heavy Nasdaq lost 2%. The Dow Jones Industrial Average told a different story despite a 1.2% weekly loss. It hit a record high close Tuesday. Dow component and Club name Honeywell was a big gainer on the week, while Apple was among laggards. .SPX .IXIC,.DJI mountain 2026-02-09 S & P 500, Nasdaq, Dow performance since Feb. 9, 2026 We’ll see if Friday’s fledgling gain after multi-session losses can carry into Monday. Until then, here are three significant drivers of the stock market over the past five sessions. 1. AI fears wreak havoc Wells Fargo and Capital One , both Club financials, were crushed last week on concerns that a new AI-driven tax planning feature could threaten the wealth management industry. The selloff in each began in earnest on Tuesday’s announcement from wealth platform Altruist and continued for two more sessions . The financials sector did stabilize some on Friday after Baird upgraded Wells Fargo stock to a hold-equivalent rating from a sell. Analysts view the bank’s valuation as more reasonable following the pullback. Still, shares of Wells Fargo and Capital One saw weekly declines of more than 7.4% and nearly 7%, respectively. Club Director of Portfolio Analysis Jeff Marks said Friday we may buy some more Capital One in the sessions ahead on the recent weakness. AI models are becoming more advanced by the day, and investors would rather shoot first and sell than be in the crosshairs before finding out how real the risks actually are. It’s something to watch, but not a thesis changer yet. The slide in Big Tech continued. Alphabet , technically in the communications services sector, was among the portfolio’s biggest decliners, down over 5% last week. Investors were concerned about the firm’s increased AI investments despite posting an excellent quarter just a couple of weeks ago. Our thesis in the stock has not changed, so we bought more shares on Tuesday. Club information technology sector names, which were slammed the prior week on worries AI will wreck their businesses, stabilized. Salesforce dropped less than 1% last week, while CrowdStrike and Palo Alto Networks recovered 8.6% and 4.8%, respectively. We never thought cybersecurity stocks should be lumped in with software-as-a-service (SaaS) stocks because their products are so crucial in today’s hostile world. That’s why we bought some more CrowdStrike on Feb. 3. Palo Alto Networks reports its earnings in the week ahead, and we’ll see if the cyber stocks can keep pulling away from the SaaS names. 2. An ‘Olympic-sized rally’ Shares of Eaton, Honeywell, Dover, DuPont, and GE Vernova continued their banner 2026 performances. It’s part of what Jim Cramer calls an “Olympic-sized rally” for industrials and other cyclical names. It may have to do with the comeuppance of Big Tech or perhaps that this market just loves stocks tied to the economy, which has been looking pretty darn good lately. We raised our price targets Wednesday on Eaton to $425 per share from $410 and GE Vernova to $875 from $800. The following session the Club locked in some profits on Eaton, which jumped over 4% last week and has run 22% since the start of the year. The trim does not mean were any less bullish on the power management solutions maker whose products, like GE Vernova’s natural gas turbines, are used in energy-hungry data centers. Consumer staples were also strong last week and outperforming for the year. The group has gained 15.6% year to date compared to the S & P 500’s flat performance. Our standout in the sector has been Procter & Gamble , which has gained 11.7% in 2026. We were buying P & G last year when consumer staples were on the outs. We thought we needed a hedge against our big tech position in case a rotation took place. That’s exactly what happened this year. Recognizing the rally in P & G has been abrupt, we locked in some profits and are now prepared to sit back with a hold-equivalent 2 rating and see what the stock does next. 3. Mixed economic signals Last week’s economic data somehow made Wall Street even more sure that the Federal Reserve will keep interest rates steady when central bankers gather in March. Investors poured over the delayed January jobs report on Wednesday, which showed that jobs growth was stronger than expected. The consumer price index , a crucial gauge of U.S. inflation, came just two days later and indicated that the cost of goods and services rose less than expected last month. Stronger labor data and a softer inflation readings were good news for both sides of the Fed’s dual mandate of fostering employment and price stability. While signaling a continued pause on rates next month, the cooler CPI did boost rate cut expectations for last this year. The market is currently favoring two to three reductions in borrowing costs in 2026. Jim reiterated last week that the performance of Club names like Home Depot are heavily tied to what the Fed does next. In fact, he referred to the home improvement retailer as a “Warsh stock” — companies that need lower rates to thrive. Home Depot is tied to the housing market, which has been stalled due to elevated mortgage rates and home prices. President Donald Trump ‘s pick for Fed chairman, Kevin Warsh , will assume the mantle, pending Senate confirmation, when current central bank chief Jerome Powell ‘s term at the helm expires in May. Warsh, a hawk during his previous stint as a Fed governor, is on broad with Trump’s lower rate mandate. Fed rate cuts last year and in 2024 have done little to make borrowing costs for home equity loans or mortgages that much more affordable. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. 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