Labor-cost rise and earnings selloff

February 10, 2026 at 21:00 UTC

5 min read

Key Points

U.S. Employment Cost Index rose, signaling persistent labor-cost pressures that put upward pressure on Treasury yields and Fed policy expectations.
Advance U.S. retail sales were flat in December versus consensus, a downside surprise that damped Treasury yields and softened the dollar.
S&P Global (SPGI)'s Q4 revenue beat was offset by a narrow EPS miss and below-consensus 2026 guidance, triggering heavy selling and pressuring sector sentiment.
Earnings reactions and macro data left utilities and real-estate outperforming, while financials and healthcare underperformed; UNF and SPOT rose sharply while UPWK and MEDP declined.

Global Market Summary

US equities were mixed as SPX slipped 0.36% and ^IXIC fell 0.60% after mixed corporate earnings and softer retail sales, while DJIA was essentially flat, up 0.05%. European benchmarks were mixed with FRA40 up 0.06%, UKX down 0.31% and DAX down 0.11%; in Asia NKY led gains, rising 2.28%, while 000001.SS inched up 0.13%.

Top Movers

Utilities led sector gains with XLU up 1.68%, while basic materials (XLB) and real estate (VNQ) each rose about 1.28%. Financials (XLF -0.79%) and healthcare (XLV -0.67%) were among the weakest sectors, with technology (VGT -0.44%) modestly lower. Notable single-stock moves included UNF (+15.19%) and SPOT (+15.17%) among gainers, while UPWK (-18.81%) and MEDP (-15.76%) were the largest decliners.

Macro highlights

The U.S. Employment Cost Index rose 0.7% q/q (3.4% y/y), signaling persistent labor-cost pressures that put upward pressure on Treasury yields (US10Y) and Fed policy expectations. Advance U.S. retail sales were flat in December versus a 0.4% consensus, a downside surprise that damped yields and softened the dollar (DXY). Dallas Fed's Logan and Cleveland Fed's Hammack described policy as close to neutral and urged patience, reinforcing expectations for rates to remain on hold and stabilizing short-end yields.

News that moved markets

S&P Global (SPGI) reported Q4 revenue above estimates while adjusted EPS narrowly missed and issued 2026 EPS guidance below consensus, triggering heavy premarket and intraday selling and pressuring sector sentiment. The Coca-Cola Company (KO) disclosed a $960 million non-cash BODYARMOR impairment and guided 2026 organic growth to 4–5%, a mix that produced a negative intraday share reaction. Harley-Davidson (HOG) posted a wider Q4 loss that weighed on its shares, and CVS Health (CVS) beat Q4 revenue and EPS but trimmed 2026 operating cash-flow guidance, producing mixed trading. Multiple completed transactions closed, including a transparency reset tied to private-equity exposure and completed sales of regional recreational-vehicle and portfolio assets. Separately, several acquisitions were announced across biopharma services, post-production, AI/healthcare and regional telecom sectors.

Upcoming session watchlist

CN Inflation Rate YoY (JAN) — forecast 0.7% vs 0.8% prior, Feb 11, 01:30 AM | Shows annual consumer price trend for January and overall inflation momentum.
US Core Inflation Rate YoY (JAN) — vs 2.6% prior, Feb 11, 01:30 PM | Tracks underlying annual inflation excluding volatile components for January.
US Core Inflation Rate MoM (JAN) — vs 0.2% prior, Feb 11, 01:30 PM | Measures monthly underlying price changes for January, excluding volatile categories.
US Inflation Rate MoM (JAN) — vs 0.3% prior, Feb 11, 01:30 PM | Indicates headline monthly consumer price pressures for January.
US Inflation Rate YoY (JAN) — vs 2.7% prior, Feb 11, 01:30 PM | Shows headline annual inflation trend for January, informing price dynamics.
US Unemployment Rate (JAN) — consensus 4.4% vs 4.4% prior, Feb 11, 01:30 PM | Summarizes labor market slack for January and overall employment conditions.
US Non Farm Payrolls (JAN) — consensus 70K vs 50K prior, Feb 11, 01:30 PM | Gauges monthly job creation and labor demand momentum for January.

Key Takeaways

U.S. equities closed mixed: S&P 500 (SPX) and Nasdaq slipped after earnings and softer retail sales, while the Dow finished essentially flat.
Utilities led sector gains while financials and healthcare underperformed; sector moves were driven by corporate earnings reactions and macro data.
Fed officials' comments described policy as near neutral and helped stabilize short-end yields, while the ECI-driven rise in Treasury yields weighed on rate-sensitive sectors.
Multiple transactions closed and a string of acquisitions were announced across biopharma services, post-production, AI/healthcare and regional telecom, adding to cross-sector M&A flows.