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    February’s US S&P Global manufacturing PMI missed forecasts, coming in at 51.2 versus 52.6 expected

    by VT Markets
    /
    Feb 20, 2026
    The S&P Global US Manufacturing PMI for February came in at 51.2. This was below the expected 52.6. A reading above 50 means manufacturing is expanding. A reading below 50 means it is contracting.

    Manufacturing Expansion Slows

    A PMI of 51.2 shows manufacturing is still growing, but the pace has slowed a lot. Missing the 52.6 forecast matters because it can signal weaker economic momentum, which may affect financial markets. With growth cooling, it may make sense to add downside protection in broad equity indices. Buying put options on the S&P 500 or the Nasdaq 100 can hedge against a pullback in the next few weeks. This matters even more after the strong rally into the end of 2025, which can leave markets exposed to bad news. When economic data misses expectations, volatility often rises. The VIX is near multi-year lows around 13.5, so VIX call options could be a way to benefit if uncertainty increases. Even a move back to average volatility could lift those positions. Softer manufacturing data can also shift Federal Reserve expectations. It likely raises the chances of a mid-year rate cut, since the Fed has been emphasizing a data-driven approach. Watch SOFR-linked derivatives, which may start pricing in a more dovish rate path.

    Sector And Currency Implications

    Industrials and basic materials are usually hit first by a manufacturing slowdown. We saw this in Q2 2025, when a PMI dip came before a temporary 6% drop in the Industrial Select Sector SPDR Fund (XLI). Buying puts on sector ETFs like XLI or XLB could be a more targeted trade. This report could also weigh on the U.S. dollar as the domestic outlook cools. The Dollar Index (DXY) is down to 103.6 today, its lowest level in three weeks. Traders may start favoring call options on currencies like the euro or Japanese yen versus the dollar. Create your live VT Markets account and start trading now.

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