| Markets are navigating a noisy mix of headlines and volatility. In this issue of Steady Investor, we break down what’s driving sentiment—and how to stay focused on long-term growth, including: - Global growth proved resilient
- Fed investigation not moving markets
- Spending strong, inflation sticky
Why Global Growth Keeps Surprising Investors – For the better part of last year, there was a growing consensus that a shifting global trade order would hurt growth overall. That did not appear to happen. The global economy posted better-than-expected growth in 2025, which for investors is a classic recipe for strong equity market returns. The World Bank now estimates global GDP expanded 2.7% in 2025, which was well above its midyear forecast. While growth is expected to moderate slightly this year, forecasts were still revised higher, reflecting stronger momentum across both advanced and emerging markets. As we’ve covered many times in this space, the U.S. economy continued to expand as consumers continued spending at an elevated clip. Oversees, Europe’s largest economies also demonstrated unexpected resilience. Germany returned to growth in 2025 after two consecutive contractions, with GDP rising 0.2%. While its export-oriented model remains challenged by tariffs, currency strength, and Chinese competition, a decisive shift toward fiscal stimulus and defense spending is beginning to change the growth mix. Large-scale defense and infrastructure spending has helped stabilize factory orders and industrial output, signaling that domestic demand is starting to replace exports as a growth engine. The U.K. also displayed tentative but meaningful signs of stabilization as well.1 Economic activity rebounded late last year, driven by stronger industrial production—particularly in autos—and steady services growth. Full-year GDP growth of roughly 1.4% marks an improvement from prior years, even as households remain cautious and investment lags peers. All told, global growth is proving more durable than feared, and growth in some key markets is re-accelerating despite structural and policy headwinds.2
Staying Focused When Markets Move With markets reacting to rate expectations, inflation data, and constant headlines, it’s easy to lose focus. But reacting to short-term swings can do more harm than good. Navigating Market Volatility 3 is a free guide designed to help you stay disciplined when markets feel uncertain. It outlines four practical principles to help you cut through the noise, manage risk, and stay confident in your long-term plan. Download it to learn how to: - Sharp market declines and corrections are a normal part of investing
- The best market days come unexpectedly (often within days or weeks of the worst days)
- Trying to pick market tops and bottoms is nearly impossible
- Trust your strategy and discipline, not the headlines
- Plus, more insights and assistance to help you keep your investment strategy on course
If you have $500,000 or more to invest, get your free volatility guide today! Download Your Free Copy Today: Navigating Market Volatility: 4 Principles for Staying the Course3
Markets Aren’t Panicking About a Criminal Investigation at the Fed—Yet – A newly announced Justice Department investigation involving Fed Chair Jerome Powell has reignited debate about how insulated US monetary policy is from outside pressure. The issue centers on Powell’s testimony before the Senate Banking Committee last June regarding the Fed’s multiyear renovation project, and Powell has said the Fed received grand jury subpoenas that threaten a potential criminal indictment. Without wading into the political fray, investors should really just be focusing on one key question: whether this investigation meaningfully changes the policy outlook . So far, markets appear to be treating it as a headline escalation, not an abrupt regime shift. Powell’s term as chair ends May 15, 2026, and his term as a governor runs through January 2028. Put another way, a leadership transition was already approaching, and uncertainty about the post-chair path was already part of the backdrop. Even in a noisy environment, however, the Fed’s decision-making process is shared across the FOMC, and future appointments require Senate confirmation—constraints that tend to limit “overnight” changes in how policy is set. That does not eliminate longer-run risks to perceived Fed independence, but it does help explain why investors are not overreacting to the story in the short-term. 4 Strong Spending, Sticky Prices—Is the U.S. Consumer Near a Breaking Point? – A batch of December data reinforced the picture of an economy that remained on solid footing late in the year, even as the inflation picture remained mixed. Starting with wholesale inflation, the producer price index rose 0.2% month over month, below forecasts, while core PPI excluding food and energy was flat, according to the Bureau of Labor Statistics. On a year-over-year basis, headline PPI rose 3.0%, with core PPI excluding trade services up 3.5%, the fastest pace since March 2025. Goods prices climbed 0.9%, largely due to a 4.6% increase in energy costs, while services prices were unchanged. Consumer spending also showed resilience.5 Retail sales rose 0.6% in November, exceeding expectations, with gains in 10 of 13 categories. Excluding autos, sales increased 0.5%, and the control group that feeds directly into GDP rose 0.4%, according to the U.S. Department of Commerce. Year-over-year sales growth of 3.3% outpaced consumer inflation, signaling real momentum in goods demand, even though the data are not adjusted for prices and were delayed by last year’s government shutdown. Finally, housing added another layer to the story. Existing-home sales jumped 5.1% in December, the largest monthly gain in nearly two years and the fourth straight increase, according to the National Association of Realtors. Sales reached their highest level since early 2023, aided by mortgage rates drifting toward 6.2% and slowing home-price growth. Still, 2025 marked the third consecutive year of historically weak sales, with transactions at their lowest level since the mid-1990s when measured per household. Overall, we see a picture of steady consumer activity within a backdrop of stubborn, but not re-accelerating, inflation. The question is whether the consumer can keep hanging on.6 Could a New Rule Impact Housing Supply and Prices in the U.S.? The Trump administration created some headlines in the housing market this week, with the announcement that the administration would seek to bar large institutional investors from buying additional single-family homes. Home prices are up more than 50% since 2019, largely reflecting years of underbuilding, higher construction costs, and mortgage-rate lock-in that have discouraged existing homeowners from selling. Bringing on more supply of houses is a key goal in lowering prices, but the rule change may not create a meaningful shift. Institutional investors own only an estimated 2%–3% of the overall U.S. housing stock, suggesting that even a sweeping ban would not materially change national supply conditions in the near term. Many institutional landlords have also been shifting their strategy of late, moving away from acquiring existing homes and toward build-to-rent developments. That trend underscores a key point for markets: policies that restrict ownership without expanding construction do little to resolve the structural imbalance between housing supply and demand.4 Volatility Isn’t New. How You Respond Is What Matters - Markets move through cycles of optimism and uncertainty, often driven by changing expectations around rates, inflation, and policy. While headlines can shift quickly, investor outcomes are shaped by decisions made over time, not by short-term reactions. Navigating Market Volatility 7 is a free guide that offers a clear framework for staying disciplined and managing risk during uncertain markets. It covers topics such as: - Sharp market declines and corrections are a normal part of investing
- The best market days come unexpectedly (often within days or weeks of the worst days)
- Trying to pick market tops and bottoms is nearly impossible
- Trust your strategy and discipline, not the headlines
- Plus, more insights and assistance to help you keep your investment strategy on course
If you have $500,000 or more to invest, access your free volatility guide today. 
|
| | © Zacks Investment Management | Privacy Policy
1 Wall Street Journal. January 15, 2026. 2 Wall Street Journal. January 13, 2026. 3 Zacks Investment Management reserves the right to amend the terms or rescind the free Navigating Market Volatility: 4 Principles for Staying the Course offer at any time and for any reason at its discretion. 4 Wall Street Journal. January 12, 2026. 5 CNBC. January 14, 2026. 6 Wall Street Journal. January 14, 2026. 7 Zacks Investment Management reserves the right to amend the terms or rescind the free Navigating Market Volatility: 4 Principles for Staying the Course offer at any time and for any reason at its discretion. DISCLOSURE Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. Zacks Investment Management, Inc. is a wholly-owned subsidiary of Zacks Investment Research. Zacks Investment Management is an independent Registered Investment Advisory firm and acts as an investment manager for individuals and institutions. Zacks Investment Research is a provider of earnings data and other financial data to institutions and to individuals. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. Do not act or rely upon the information and advice given in this publication without seeking the services of competent and professional legal, tax, or accounting counsel. Publication and distribution of this article is not intended to create, and the information contained herein does not constitute, an attorney-client relationship. No recommendation or advice is being given as to whether any investment or strategy is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Any projections, targets, or estimates in this report are forward looking statements and are based on the firm's research, analysis, and assumptions. Due to rapidly changing market conditions and the complexity of investment decisions, supplemental information and other sources may be required to make informed investment decisions based on your individual investment objectives and suitability specifications. All expressions of opinions are subject to change without notice. Clients should seek financial advice regarding the appropriateness of investing in any security or investment strategy discussed in this presentation. Certain economic and market information contained herein has been obtained from published sources prepared by other parties. Zacks Investment Management does not assume any responsibility for the accuracy or completeness of such information. Further, no third party has assumed responsibility for independently verifying the information contained herein and accordingly no such persons make any representations with respect to the accuracy, completeness or reasonableness of the information provided herein. Unless otherwise indicated, market analysis and conclusions are based upon opinions or assumptions that Zacks Investment Management considers to be reasonable. Any investment inherently involves a high degree of risk, beyond any specific risks discussed herein. It is not possible to invest directly in an index. Investors pursuing a strategy similar to an index may experience higher or lower returns, which will be reduced by fees and expenses. The S&P 500 Index is a well-known, unmanaged index of the prices of 500 large-company common stocks, mainly blue-chip stocks, selected by Standard & Poor's. The S&P 500 Index assumes reinvestment of dividends but does not reflect advisory fees. The volatility of the benchmark may be materially different from the individual performance obtained by a specific investor. An investor cannot invest directly in an index. The Russell 2000 Index is a well-known, unmanaged index of the prices of 2000 small-cap company common stocks, selected by Russell. The Russell 2000 Index assumes reinvestment of dividends but does not reflect advisory fees. An investor cannot invest directly in an index. The volatility of the benchmark may be materially different from the individual performance obtained by a specific investor. Nasdaq Composite Index is the market capitalization-weighted index of over 3,300 common equities listed on the Nasdaq stock exchange. The types of securities in the index include American depositary receipts, common stocks, real estate investment trusts (REITs) and tracking stocks, as well as limited partnership interests. The index includes all Nasdaq-listed stocks that are not derivatives, preferred shares, funds, exchange-traded funds (ETFs) or debenture securities. An investor cannot invest directly in an index. The volatility of the benchmark may be materially different from the individual performance obtained by a specific investor. The Dow Jones Industrial Average measures the daily stock market movements of 30 U.S. publicly-traded companies listed on the NASDAQ or the New York Stock Exchange (NYSE). The 30 publicly-owned companies are considered leaders in the United States economy. An investor cannot directly invest in an index. The volatility of the benchmark may be materially different from the individual performance obtained by a specific investor. Returns for each strategy and the corresponding Morningstar Universe reflect the annualized returns for the periods indicated. The Morningstar Universes used for comparative analysis are constructed by Morningstar (median performance) and data is provided to Zacks by Zephyr Style Advisor. The percentile ranking for each Zacks Strategy is based on the gross comparison for Zacks Strategies vs. the indicated universe rounded up to the nearest whole percentile. Other managers included in universe by Morningstar may exhibit style drift when compared to Zacks Investment Management portfolio. Neither Zacks Investment Management nor Zacks Investment Research has any affiliation with Morningstar. Neither Zacks Investment Management nor Zacks Investment Research had any influence of the process Morningstar used to determine this ranking. Zacks Investment Management
101 N. Wacker Drive
Suite 1500
Chicago, Illinois 60606
If you do not wish to receive further email solicitations from Zacks on behalf of its partners, please click here to unsubscribe.  | |
0 التعليقات:
إرسال تعليق