February Market Outlook

The Latest

After one of the market’s worst annual performances in recent memory, we have seen a month of encouraging progress. The S&P 500 gained more than 6% in January, and many believe that this momentum could continue through February despite the Fed’s 25 basis point continuation of their rate hiking efforts. Prices for consumers have moderated substantially from the levels that were seen when inflation was peaking in 2022. GDP and labor market readings have shown that our economy is still standing its ground, and although the Fed could see that as reason to continue hiking rates, it signifies that there is still hope for a ‘soft landing’.

Opportunities

With the year-over-year CPI reading for December at 6.5%, there is still work to be done, but there is evidence that we are heading in the right direction. Businesses are expecting slower growth in the coming months, and earnings for some of the largest companies in the tech sector have fallen in line with these expectations. However, there are still plenty of companies remaining resilient in this volatile market. Long-term investors know how difficult it is to time the market, so consider if you are letting your emotions get the best of you and remember to stick to your individual investment plan. We are here to help guide you through times like this.

Going Forward

Since 1945, whenever the S&P was higher in January, the market posted an average annual gain of 15.8% (versus the average annual gain of 8.9% for all years) and rose in price 85% of the time (compared with the more normal 71%)  We are seeing things play out much in line with what we predicted a month ago. We continue to expect a relatively bumpy ride in the near future, but despite the uncertainty, what holds true is that markets are forward-looking, and there will be good news ahead.

As always, do not hesitate to reach out with any questions you may have for us.

Sources:

https://www.forbes.com/advisor/investing/stock-market-outlook-and-forecast/

https://www.schwab.com/learn/story/weekly-traders-outlook

Disclaimer:

Past performance is not a guarantee of future results.

BNY Mellon | Pershing is our clearing and custody provider. Olistico Wealth, LLC, a registered investment adviser. Pershing and Olistico Wealth, LLC are separate, unaffiliated companies, not responsible for each other’s services or policies. Pershing LLC (member FINRA, NYSE, SIPC) is a BNY Mellon company. Past performance is no guarantee of future results.