Daily Rundown

February 5, 2026

Chart of the Day

Number of the Day

$175-185 billion - Alphabet's planned capital expenditures for 2026, up from $91.5 billion last year and $52.5 billion in 2024

Quote of the Day

"Data centers are causing large spikes in requirements. Suppliers are challenged by capacity and tariffs. Therefore, this is both an exciting and challenging time in the industry." - Respondent to the January ISM services survey

Wednesday's Highlights

ADP's employment estimate (January) rose by 22,000. Health care/education jobs were up by 74,000 while business services and manufacturing payrolls both moved lower.

The ISM services index (January) held steady at 53.8. Business activity improved while new orders and employment slowed.

The homebuyer affordability index (December) hit a 45-month high, as median prices and mortgage rates continued to trend lower.

Mortgage purchase applications (week of 1/24) fell by 14.4 percent to end the month with a small decline. The average 30-year fixed rate was little changed at 6.2 percent.

Quick Commentary

The pickup in economic activity in recent weeks doesn't appear to have done much to lift job growth, as yesterday's ADP tally was again soft and narrowly driven. However, even a dormant labor market is unlikely to forestall some pickup in the near-term pace of expansion. Alphabet's capital spending plans alone would equate to more than one half of one percent of the current level of GDP, the latest sign that the AI boom is still in a significant upswing and still a bulwark against a broader economic decline. At the same time, soaring investment is laying the groundwork for a larger pullback once the cycle finally turns. Alphabet's capex in Q4 amounted to 24.5 times its sales, nearly double the long-term average (Microsoft's numbers are even more extreme at 36.8 times sales, or more than four times the long-term average). This is unlikely to end well, even if it still doesn't look to be ending imminently.

Today's Highlights

Initial unemployment claims

Job openings

Amazon earnings

Daily Trivia

What NFL franchise has had the greatest economic impact on its local market in per capita terms, as evidenced by the data on hotel rates, tax receipts, and retail activity during its home game weekends?

(Tuesday's Question: What is the only company that has held the naming rights on two different Super Bowl stadiums? Answer: Mercedes-Benz (Atlanta and New Orleans))