by Louis Navellier
March 3, 2026
Looking beyond the headlines of wars and other global political turmoil, the U.S. remains the world’s primary economic oasis. One clue is our declining interest rates: Last week, the 10-year Treasury bond-yield fell below 4% and mortgage rates dipped below 6% for the first time since 2022.
In the stock market so far this year, there has been a flight to quality underway as nervous investors flee stocks due to a temporary case of “AI derangement syndrome,” shorthand for fears of unemployment continuing to soar as AI replaces salaried workers in many companies.
Jensen Huang, Nvidia’s charismatic founder and CEO, said Wall Street is mistaken to assume AI is bad for software stocks. He says the media continue to perpetuate AI fears, perhaps because they are worried about layoffs themselves if they don’t boost their ratings. This fear came to light when CNBC announced restructuring its newsroom to consolidate its TV and digital operations in a move resulting in some key layoffs, including the departure of the website’s managing editor, Jeff McCracken. Another example is The Washington Post recently laying-off a third of its workforce after losing $100-million in 2025.
Speaking of Nvidia, the company announced its fourth-quarter revenue rose 73.3% to $68.1-billion compared to $39.3-billion in the same quarter a year-ago. During the same period, the company’s operating earnings surged 97.8% to $42.96-billion or $1.76 per-share compared with $22.09-billion, or 89-cents per-share. Excluding extraordinary items, Nvidia’s operating earnings were $1.62 per-share. The analyst community was anticipating revenue of $66.13-billion and operating earnings growth of $1.54 per-share, so Nvidia posted a 3% revenue surprise and a 5.2% earnings surprise. More importantly, the company also raised its guidance for future sales and earnings above the analysts’ consensus estimates.
In the earnings press release, Nvidia CEO Jensen Huang told investors: “Computing demand is growing exponentially — the agentic AI inflection point has arrived.” Although Nvidia got hit with some normal profit taking – as I have repeatedly warned – after its earnings news, all the covered call option writing on the stock can make “the tail wag the dog.” From here, I believe the stock should hit $300 per-share by the end of 2026 and $500 by the end of the decade, so back up the truck and keep buying Nvidia on dips.
In other economic news, the Labor Department reported its Producer Price Index (PPI) rising 0.5% in January, substantially higher than the economists’ consensus estimate of a 0.3% increase. The core PPI, excluding food, energy and trade margins, rose 0.3%. Wholesale service costs surged by 0.8% in January, the largest increase since last July, while wholesale goods prices actually declined 0.3%, the third time in the past five-months when goods prices fell. Overall wholesale food prices declined 1.5% in January, while wholesale energy prices fell 2.7%. A 2.5% surge in trade services distorted the PPI, as it did in December, when it rose by 1.8%, so inflation is fairly low if you focus on actual wholesale goods prices.
In Tuesday’s State of the Union address, President Trump said the energy demand for data-centers could “unfairly” drive up utility costs for many Americans, so he proposed a “rate-payer protection pledge” requiring technology companies to provide their own power needs and “build their own power plants,” saying, “We’re telling the major technology companies they have the obligation to provide for their own power needs.”
Obviously, this is great news for Bloom Energy (BE) and GE Vernova (GEV), which can generate electricity via natural gas fuel-cells and turbines when there is a direct natural gas line to data-centers.
Our data-center stocks beat estimates and guided higher due to rising order backlogs. In other sectors, Eli Lilly (LLY) also hit it “out of the park” and our gold stocks also announced record sales and earnings. Essentially, I run our portfolios like a sports team, as we try to assemble the “best players in the game.”
For example, I was immensely happy to see our growth portfolios actually rising last Monday, when the Dow Jones Industrials plunged 814-points and NASDAQ dropped over 291-points. This was primarily due to the gold stocks I recommend as well as the continued strength in our data-center related stocks.
In contrast, most of last Monday’s carnage was in financial stocks, especially companies impacted by Blue Owl’s private credit redemption freeze. I had been warning you about this potential private credit “Black Swan” event for a long time, and now we see Blue Owl announcing it had permanently restricted investors from exiting one of its retail funds, namely Blue Owl Capital Corp II. This news caused the stock prices of Ares Management, Apollo Global Management, KKR, Blackstone and TPG to sell-off.
Complicating matters further, BlackRock slashed the value of some of its private credit holdings in the past month. Mohamed El-Erian, former head of Pimco, posted this question on X: “Is this a ‘canary-in-the-coalmine’ moment?” Also, JPMorgan CEO Jamie Dimon said, “I’m shocked that people are shocked,” adding, “I mean the reality is, in this environment, as the world gets more volatile, as you get towards the end of the cycle, this outcome should be expected, so we prepare for all of these scenarios.”
Since private credit is now a $3-trillion per year industry – built on the kind of lending Dodd Frank made difficult for the banks to do – so the Dodd Frank regulators have facilitated this “shadow banking system.” In the event there is a private credit “Black Swan” event to disrupt our credit markets, then the Fed may have to step in to provide liquidity or slash key interest rates to help stabilize the situation.
America’s Finances Should Improve under a New Fed Chair Coming in May
Meanwhile, the upcoming Senate confirmation hearings for the Fed Chairman nominee, Kevin Warsh, should be interesting, especially since Warsh said AI will trigger “the most productivity enhancing wave of our lifetimes – past, present and future.” As a result, Warsh expects the AI productivity wave to expand output and pave the way for the Fed to cut key interest rates without triggering a rise in prices.
Warsh has called for a closer relationship between the Fed and Treasury. This implies better yield curve management and open market actions by the Fed – perhaps coordinated between the Fed and Treasury Department. The Treasury yield curve is now the steepest in four-years, so Treasury Secretary Bessent has been successful in fixing the inverted Treasury yield curve which plagued his predecessor, Janet Yellen.
When the Fed meets in May for their Federal Open Market Committee (FOMC) meeting and Kevin Warsh takes over as Chair, the FOMC is expected to cut key interest rates and provide guidance for additional rate-cuts. We’ve seen S&P 500 earnings growing faster than sales for ten-straight quarters, which signals operating margins and productivity are rising. The S&P 500’s 2026 earnings forecasts remain in double-digits for all the coming quarters and are expected to get stronger later in the year.
Global interest rates also continue to collapse. The latest example is the Bank of Thailand voting 4 to 2 on Wednesday to cut its key interest rate by 0.25% to 1%. The central bank said it’s important to safeguard “medium-term financial stability as well as preserving limited monetary policy space amid heightened uncertainties.” The Bank of Thailand added its belief the current interest level is becoming more aligned with the economic outlook. Thailand’s economy has struggled to return to pre-pandemic levels of growth, weighed down by high household debt, weak consumption and a slow tourism recovery. Furthermore, like all of Asia, demographics from an aging society continue to impede overall economic growth.
America’s national mood is starting to pick up. One good sign is the Conference Board’s consumer confidence index rising to 91.2 in February, up from a revised 89 in January. Economists were expecting consumer confidence to fall to 87.1, so this was a big surprise. The expectation component rose to 72 in February, up from 67.4 in January – another “green shoot.” As spring arrives, consumers often cheer-up, after many struggled with the severe winter weather striking across the northeastern U.S.
In conclusion, I’d say we are in the midst of what could be the strongest economic growth in over 40-years. Whether GDP growth hits 5%, as I predicted on Fox Business, or 6% as Howard Lutnick predicted, or even the seemingly impossible 15% President Trump said is possible, there is no doubt 2026 will deliver the best growth we’ve seen since 1984’s 6.8% GDP surge. With the accommodative Fed cutting key interest rates, the stock market should gather more momentum in the spring. I hope you are enjoying the ride and having fun along the way, since 2026 is shaping up to be the strongest year in decades!
Navellier & Associates; own Nvidia Corp (NVDA), Eli Lilly and Company (LLY), Bloom Energy Corporation Class A (BE), and GE Vernova Inc. (GEV) in managed accounts. We do not own Blue Owl Capital-(OWL), Ares Management-(ARCC), Apollo Global Management-(APO), KKR Inc-(KKR) or Blackstone-(BX). Louis Navellier and his family own Nvidia Corp (NVDA), Eli Lilly and Company (LLY), Bloom Energy Corporation Class A (BE), and GE Vernova Inc. (GEV), via a Navellier managed account and Nvidia Corp (NVDA), in a personal account. They do not own Blue Owl Capital-(OWL), Ares Management-(ARCC), Apollo Global Management-(APO), KKR Inx-(KKR) or Blackstone-(BX).
All content above represents the opinion of Louis Navellier of Navellier & Associates, Inc.
Also In This Issue
A Look Ahead by Louis Navellier
The U.S. Remains the World’s Primary Economic Oasis
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High Yield Investments Benefit from This Market Reset
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Global Mail by Ivan Martchev
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Louis Navellier
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Louis Navellier is Founder, Chairman of the Board, Chief Investment Officer and Chief Compliance Officer of Navellier & Associates, Inc., located in Reno, Nevada. With decades of experience translating what had been purely academic techniques into real market applications, he believes that disciplined, quantitative analysis can select stocks that will significantly outperform the overall market. All content in this “A Look Ahead” section of Market Mail represents the opinion of Louis Navellier of Navellier & Associates, Inc.
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