The market volatility that began the year continued into February. Large-cap U.S. stocks struggled particularly as investor uncertainty over the outlook for returns on AI-related expenditures rose. A higher-than-expected increase in producer-price inflation reduced expectations for further, near-term cuts in policy rates. Bond yields remained relatively stable with the 10-year U.S. Treasury yield falling below 4% for the first time since November. At the same time, the potential price of credit risk appeared in a decline in the value of leverage loans. Developed market stocks far outperformed U.S. stocks as the perception of risk there remained subdued.