The final session of February brought a clear deterioration in sentiment on capital markets. The main factor curbing gains on Wall Street turned out to be producer inflation data, which fueled concerns about future interest rate policy. In Europe, investor attention focused on the Italian banking sector, where the announcement of an ambitious strategic plan for Monte dei Paschi di Siena and Mediobanca for 2026-2030 was met with a positive reception.

Inflation in the US Cools Optimism

PPI data above expectations increased concerns about interest rates in the US.

MPS Stock Crisis in Italy

The share price of the world's oldest bank fell drastically after the announcement of merger plans.

End of State Supervision at MPS

Prime Minister Giorgia Meloni announced the government's exit from the shareholding of Montepaschi bank.

Weakness in the Technology Sector

Doubts surrounding the AI bubble negatively impacted the Nasdaq index and software companies.

The session on financial markets on February 27, 2026, was marked by high volatility and a return of risk-off sentiment. The American Dow Jones, S&P 500, and tech-heavy Nasdaq indices ended the week in the red. The direct cause of the sell-off in New York was the publication of the producer price index (PPI) report, which turned out to be higher than market assumptions. Investors interpreted this data as a signal for the Federal Reserve to maintain a restrictive monetary policy for a longer period. An additional burden for the technology sector was growing doubts about the profitability of investments in artificial intelligence, resulting in valuation drops for software industry giants. After the 2008 financial crisis, central banks worldwide kept interest rates near zero for over a decade, which fueled a bull market in equities and rapid development of the technology sector. In Europe, market attention focused on Milan, where there was a sharp collapse in the share price of Monte dei Paschi di Siena (MPS). The sell-off occurred after the announcement of an integration plan with the investment bank Mediobanca, which the markets assessed negatively. The situation was worsened by statements from Italian Prime Minister Giorgia Meloni, who in an interview with Bloomberg agency declared that the government's role in overseeing MPS had come to an end. The opposition in Italy sharply criticized the timing of this communication, deeming it irresponsible, as the statement was made during the trading session, deepening investor panic. Despite the local banking crisis, the Milan stock exchange closed February with a 3.7% gain, outperforming many other developed markets for the month. „Il ruolo del governo in Mps è finito, nessuna influenza sulla governance.” (The government's role in MPS is over, no influence on governance.) — Italian Prime Minister Giorgia Meloni On the Polish market, the WIG20 index also deepened its losses, reflecting the global retreat from risk. A major influence on domestic listings were declines in the banking sector, similar to other European markets. Investors in Warsaw and on other old continent trading floors are increasingly concerned about the impact of geopolitical tensions, including the situation around Iran, on the stability of raw material supplies. The only positive note in the energy market was a drop in natural gas futures contract prices, which closed the week at 31.9 euros per megawatt-hour. 3.7% — gain recorded in February by the main index of the Milan stock exchange In summary, February ends in an atmosphere of uncertainty. The market, which in recent months was driven by optimism related to artificial intelligence, is beginning to verify the valuations of technology companies. Simultaneously, the stability of the European banking sector is once again becoming a topic of discussion in the context of states withdrawing extraordinary support for financial institutions.

Mentioned People

  • Giorgia Meloni — Prime Minister of Italy, who announced the end of the government's role in MPS bank.
  • Luigi Lovaglio — Chief Executive Officer of Monte dei Paschi di Siena bank.