Market Commentary - January 26, 2026
So How Is The 4Q Earnings Season Starting Off?
With so many geopolitical events happening with increased frequency, it is easy to get distracted from what really matters to the stock market – earnings. We’re still in the early days of getting 4Q 2025 earnings reports – only 13% of companies have reported to date. But it’s important to note that, so far, the S&P 500 is reporting year-over-year earnings growth for the 10th straight quarter with an 8% growth rate. According to FactSet, of the companies in the S&P 500 that have reported actual results for 4Q 2025 to date, 75% have reported actual EPS above estimates – which is below the 5- and 10-year averages. In aggregate, companies are reporting earnings that are 5.3% above estimates, which is also below the 5- and 10-year averages. We are not surprised. In our Year Ahead report published in November, we highlighted that one of the risks this year would be that it would be harder for companies to beat expectations as analysts’ estimates had risen sharply. We don’t believe this is a negative, but it can lead to volatility within the market.
Market Commentary - January 20, 2026
The Bull Is Still Charging
The equity market is finally broadening out with the Dow Jones Industrial Transportation Average (DJTA) breaking to new all-time highs, finally surpassing its November 2021 high. Small caps have moved to record highs along with the equal-weighted S&P 500. The broadening out of the market has moved the NYSE Cumulative Advance–Decline Line to an all-time high along with our volume model moving to record highs – both indicators confirming the breakouts in the market. This is evidence that the bull market continues to charge forward in 2026 – but just with higher volatility, which remains one of our themes for the year ahead. The S&P 500 remains overbought, which could lead to additional volatility, but investors should remain fearless as we do expect the S&P 500 to reach 7500 by year-end for an 8% gain from current levels.
Perspectives - January 16, 2026
Chartbook December 2025
The U.S. economy grew at a robust 4.3% annualized rate in the third quarter, far exceeding expectations and marking the strongest growth since Q3 2023. The expansion was driven mainly by consumer spending, particularly on healthcare - which alone added 0.8% to GDP - and on information-processing equipment such as consumer electronics. Government spending, led by federal defense outlays, contributed an additional 0.4%, while exports rose and imports fell. However, business investment slowed and consumer confidence dropped sharply in December to near five-year lows, signaling potential weakness ahead. Economists caution that slower consumer spending and the effects of the recent government shutdown are likely to weigh on growth in the final quarter of 2025.
Market Commentary - January 12, 2026
First On-Time Jobs Report Since Government Shutdown Shows Data Improvement
Last Friday we received the first good look at the job market since the government shutdown with the release of the December jobs data. The data shows the jobs market is soft but not weakening significantly. The report indicated that fewer jobs were created, but the unemployment rate improved, moving down to 4.4% from the prior report’s 4.6%figure, which helps to alleviate the Fed’s concern about the state of employment. The Federal Reserve (Fed) is not likely to move interest rates based on this data release, in our view. The market is expecting additional interest rate cuts but not until later in the year.