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Weekly Market Commentary

The Markets

Geopolitics roiled financial markets.

Just a couple of weeks ago, many analysts and asset managers expressed broad optimism about the potential performance of United States stock markets in 2026¹ – and the stock market started the year strong. “The S&P 500 closed at new records three times in the first seven trading days of 2026, and isn’t far from its all-time high,”² reported Teresa Rivas of Barron’s in mid-January.

U.S. stocks moved lower last week

Early last week, markets focused sharply on the elephant in the room – geopolitics. Lynn Thomasson and Sabrina Nelson Garcinuno of Bloomberg reported:

“For weeks on Wall Street, markets were unusually subdued as President Donald Trump threatened the post-war order by asserting US dominance of the Western hemisphere. But with his drive to take over Greenland throwing the European and American alliance in disarray…the calm abruptly snapped. As stock markets opened on Tuesday, the ‘Sell America’ trade came back in full force…The S&P 500 dropped over 2 [percent], erasing all of this year’s gains.”³

U.S. Treasury yields moved higher

The U.S. Treasury market swooned, too. The yield on 30-year U.S. Treasury bonds rose from 4.79 percent at the end of the previous week to 4.91 percent on Tuesday.⁴

The U.S. wasn’t the only country to see yields move higher. Global bond yields rose after the Japanese Prime Minister proposed to cut taxes on food, which bond markets feared could lead to higher inflation.⁵ Phil Serafino of Bloomberg explained:

“…higher yields act as a powerful magnet, pulling Japanese savers’ money out of markets around the globe and drawing it back home. That means less demand for sovereign bonds such as [U.S.] Treasuries,” wrote Serafino. “Another factor: governments and companies are flooding the market with new bonds as they ramp up spending on defense, data centers, and just about everything else,” explained Serafino. ⁵

The law of supply and demand holds that a rising supply of bonds in combination with falling demand is likely to lead to lower bond prices and higher interest rates, reported Jason Fernando of Investopedia.⁶

By the end of the week, U.S. stock and bond markets had calmed. “The S&P 500 danced around the breakeven line Friday afternoon while the Dow Jones Industrial Average was down…and the Nasdaq Composite was up,” reported Karishma Vanjani of Barron’s.⁷ The yield on the 30-year U.S. Treasury bond finished the week at 4.82 percent.⁴

Data as of 1/23/26	1-Week	YTD	1-Year	3-Year	5-Year	10-Year
Standard & Poor’s 500 Index	-0.4%	1.0%	13.0%	19.8%	12.4%	13.9%
Dow Jones Global ex-U.S. Index	0.6	4.6	31.4	13.1	5.2	7.2
10-year Treasury Note (yield only)	4.2	N/A	4.6	3.5	1.0	2.0
S&P GSCI Gold Index	8.4	15.6	79.7	37.1	22.0	16.3
Bloomberg Commodity Index	5.3	9.0	15.6	2.1	8.4	4.9

S&P 500, Dow Jones Global ex-US, S&P GSCI Gold Index, Bloomberg Commodity Index returns exclude reinvested dividends. The three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury.

Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

WHAT COULD HIGHER TREASURY RATES MEAN FOR THE UNITED STATES? The U.S. government spends a lot of money. Some of that spending is covered by with taxes, tariffs, and other sources of revenue. When that’s not enough, the government borrows the money it needs to operate.⁸

The U.S. borrows money by issuing U.S. Treasury bills, notes, and bonds. When a person, company, or country buys a U.S. Treasury, they are lending the government money. In return, the United States agrees to pay interest for a specific period of time and then return the amount borrowed.⁹

The interest the United States pays on Treasuries is a lot like the interest people pay on outstanding credit card balances. The higher the debt, the more interest is owed.

U.S. interest costs are growing

Officially, the U.S. government’s spending year begins in October, which can be confusing. The period from October through December 2025 is known as the first quarter of Fiscal Year 2026 (FY26).¹⁰

Over that period, Fiscal Data reported the federal government:¹⁰

Spent $1.83 trillion,
Collected $1.22 trillion, and
Ran short by about $602 billion.

In FY26, the government spent more on interest on the national debt (+13 percent), and Social Security and Medicare (+9 percent). It spent less on the Environmental Protection Agency (-81 percent), Department of Homeland Security/FEMA disaster relief (-38 percent), Department of Education (-26 percent), and Department of Agriculture (-18 percent).¹¹

For context, in FY 2025 (the period from October 1, 2024, to September 30, 2025), the U.S. government:¹²

Spent $7.01 trillion,
Collected $5.23 trillion, and
Ran short by $1.78 trillion.

Higher interest costs mean less money for other priorities

As interest costs rise, they tend to “crowd out opportunities for investment in other important priorities. In fact, the [United States] government is already spending more on interest costs than on education, research and development, and infrastructure combined. If unaddressed, the growing borrowing costs will pose significant challenges for the nation’s fiscal future,” reported the Peter G. Peterson Foundation.¹³

WEEKLY FOCUS – THINK ABOUT IT

“Trust yourself. Create the kind of self that you will be happy to live with all your life. Make the most of yourself by fanning the tiny, inner sparks of possibility into flames of achievement.”¹⁴― Golda Meir, Former Israeli Prime Minister

* These views are those of Carson Coaching, not the presenting Representative, the Representative’s Broker/Dealer, or Registered Investment Advisor, and should not be construed as investment advice.

* This newsletter was prepared by Carson Coaching. Carson Coaching is not affiliated with the named firm or broker/dealer.

* Government bonds and Treasury Bills are guaranteed by the U.S. government as to the timely payment of principal and interest and, if held to maturity, offer a fixed rate of return and fixed principal value. However, the value of fund shares is not guaranteed and will fluctuate.

* Corporate bonds are considered higher risk than government bonds but normally offer a higher yield and are subject to market, interest rate and credit risk as well as additional risks based on the quality of issuer coupon rate, price, yield, maturity, and redemption features.

* The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. You cannot invest directly in this index.

* All indexes referenced are unmanaged. The volatility of indexes could be materially different from that of a client’s portfolio. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment. You cannot invest directly in an index.

* The Dow Jones Global ex-U.S. Index covers approximately 95% of the market capitalization of the 45 developed and emerging countries included in the Index.

* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

* Gold represents the 3:00 p.m. (London time) gold price as reported by the London Bullion Market Association and is expressed in U.S. Dollars per fine troy ounce. The source for gold data is Federal Reserve Bank of St. Louis (FRED), https://fred.stlouisfed.org/series/GOLDPMGBD228NLBM.

* The Bloomberg Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.

* The Dow Jones Industrial Average (DJIA), commonly known as “The Dow,” is an index representing 30 stock of companies maintained and reviewed by the editors of The Wall Street Journal.

* The NASDAQ Composite is an unmanaged index of securities traded on the NASDAQ system.

* International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. These risks are often heightened for investments in emerging markets.

* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.

* The risk of loss in trading commodities and futures can be substantial. You should therefore carefully consider whether such trading is suitable for you in light of your financial condition. The high degree of leverage is often obtainable in commodity trading and can work against you as well as for you. The use of leverage can lead to large losses as well as gains.

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

* Past performance does not guarantee future results. Investing involves risk, including loss of principal.

* The foregoing information has been obtained from sources considered to be reliable, but we do not guarantee it is accurate or complete.

* There is no guarantee a diversified portfolio will enhance overall returns or outperform a non-diversified portfolio. Diversification does not protect against market risk.

* Asset allocation does not ensure a profit or protect against a loss.

* Consult your financial professional before making any investment decision.

Sources:

1 https://www.bloomberg.com/news/articles/2025-12-29/bulls-only-every-wall-street-analyst-now-predicts-a-stock-rally or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/01-26-26-Bloomberg-Every-Wall-Street-Analyst%20-%201.pdf

2 https://www.barrons.com/articles/stock-market-rally-iran-venezuela-fed-b5bfac0b? or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/01-26-26-Barrons-The-World-is-a-Dumpster-Fire%20-%20%202.pdf

3 https://www.barrons.com/livecoverage/stock-market-news-today-012026?mod=hp_LEDE_C_1 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/01-26-26-Bloomberg-Treasuries-Stocks-Sell-Off%20-%203.pdf

4 https://home.treasury.gov/resource-center/data-chart-center/interest-rates/TextView?type=daily_treasury_yield_curve&field_tdr_date_value=202601

5 https://www.bloomberg.com/news/newsletters/2026-01-20/japan-is-driving-global-bond-yields-higher? or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/01-26-26-Bloomberg-Japan-is-Driving-Global%20-%205.pdf

6 https://www.investopedia.com/terms/b/bond.asp

7 https://www.barrons.com/livecoverage/stock-market-news-today-012326?mod=hp_LEDE_C_2 or go to https://resources.carsongroup.com/hubfs/WMC-Source/2026/01-26-26-Barrons-The-S&P-500-Teeters%20-%207.pdf

8 https://www.pgpf.org/federal-budget-guide/

9 https://www.investopedia.com/terms/t/treasurybond.asp

10 https://fiscaldata.treasury.gov/americas-finance-guide/

11 https://bipartisanpolicy.org/report/deficit-tracker

12https://fiscaldata.treasury.gov/americas-finance-guide/government-revenue/

13 https://www.pgpf.org/article/what-are-interest-costs-on-the-national-debt/

14 https://www.brainyquote.com/quotes/golda_meir_162893?src=t_trust

Posted on January 26, 2026

Weekly Market Commentary

The Markets

Investor appetite broadens.

For a long time, investors have craved artificial intelligence (AI) related investments. Early in 2026, that’s begun to change. Paul R. La Monica of Barron’s reported:

“Everywhere you look, stocks of all stripes are hitting new highs. That should be great news for investors as the market broadens out to start 2026…The broadening of the rally is picking up steam. You wouldn’t know it from looking at the major indexes…While the declines were small and the indexes remain near all-time highs, the fact that they are underperforming small-caps, international stocks, and the equal-weighted S&P 500 is another sign that investors are looking beyond the usual suspects for stocks to buy.”¹

Here’s what we saw last week:

Smaller companies taking the lead. The Russell 2000 Index, which tracks the performance of small company stocks, performed better than the Standard & Poor (S&P) 500 Index last week for the 11^th trading session in a row, reported Joel Leon of Bloomberg.²

A Treasury market shake-up. The yield on benchmark 10-year U.S. Treasuries rose to 4.24 percent³ after President Trump appeared to change his mind about who might replace Federal Reserve Chair Jerome Powell later this year, reported Michael MacKenzie, Elizabeth Stanton, and Alex Harris of Bloomberg.⁴

The current frontrunner for the position is former Fed governor Kevin Warsh, who “has more credibility in the world of central banking and is perceived as someone who will keep the central bank narrowly focused on its mandate, with a willingness to move toward a less dominant central bank footprint in markets.”⁴

Good news on prices. The rate of inflation didn’t fall to the Federal Reserve’s target level of two percent in December,⁵ but it also didn’t move higher. Prices rose 2.7 percent annualized last month. When volatile food and energy prices were excluded, inflation was 2.6 percent annualized, according to the Consumer Price Index (CPI).⁶

While inflation overall was steady, prices for housing, groceries, clothes, recreation, and airfare moved higher. These price increases were balanced by price declines for household furnishings, used cars and trucks, and gasoline.⁶

While they remained near all-time highs at the end of last week,¹ the Standard & Poor’s 500 Index, Nasdaq Composite, and Dow Jones Industrial Average finished lower.⁷ The yield on the benchmark 10-year U.S. Treasury was higher.³

Data as of 1/16/26	1-Week	YTD	1-Year	3-Year	5-Year	10-Year
Standard & Poor’s 500 Index	-0.4%	1.4%	16.9%	20.3%	12.8%	13.9%
Dow Jones Global ex-U.S. Index	1.7	4.0	33.3	13.2	5.3	7.3
10-year Treasury Note (yield only)	4.2	N/A	4.6	3.5	1.1	2.
S&P GSCI Gold Index	2.6	6.6	66.7	33.9	20.2	15.6
Bloomberg Commodity Index	1.3	3.6	9.0	0.5	7.3	4.4

S&P 500, Dow Jones Global ex-US, S&P GSCI Gold Index, Bloomberg Commodity Index returns exclude reinvested dividends. The three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury.

Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

LET’S TALK MONEY! Everywhere you look, money and economics influence the world. The language of money has its roots in medieval Spanish literature, according to Cornell Professor Simone Pinet.⁸ As the merchant economy developed there, the language of money and trade spread throughout society. Over the centuries and around the world, people have coined colorful terms for currency and wealth. See what you know about the language of money by taking this brief quiz.

What is “net worth”?⁹
- a. The amount of money you earn each year
- b. The value of everything you own minus money owed
- c. The amount of cash in your bank account
- d. The amount you can borrow based on your credit score
When a news story says a company is raising “capital”, what is it trying to do?¹⁰
- a. Raise money to expand its business
- b. Sell stocks to finance new product development
- c. Borrow money to build a new research facility
- d. Any of the above
Which of the following is slang meaning “one dollar”?¹¹
- a. Sawbuck
- b. Simoleon
- c. Benjamin
- d. C-note
Which of the following slang terms does NOT imply wealth, refinement, or upper-class status?¹²
- a. Silk Stocking
- b. Croesus
- c. Moolah
- d. Plutocrat

WEEKLY FOCUS – THINK ABOUT IT

“When you plant lettuce, if it does not grow well, you don’t blame the lettuce. You look for reasons it is not doing well. It may need fertilizer, or more water, or less sun. You never blame the lettuce. Yet if we have problems with our friends or family, we blame the other person. But if we know how to take care of them, they will grow well, like the lettuce. Blaming has no positive effect at all, nor does trying to persuade using reason and argument. That is my experience. No blame, no reasoning, no argument, just understanding. If you understand, and you show that you understand, you can love, and the situation will change”¹³

― Thich Nhat Hanh, Author

Answers:

b; 2.) d; 3.) b; 4) c

Posted on January 20, 2026

Weekly Market Commentary

The Markets

Lots of people are willing to predict what’s ahead.

If the past is prologue, few will be accurate. You don’t have to look far to find an example. In 2023, a majority of economists agreed recession was ahead. They were wrong. Tyler Cowen of Bloomberg explained:¹

“Last year at this time, 85 [percent] of economists in one poll predicted a recession this year — and that was an optimistic take compared to the 100 [percent] probability of a recession forecast two months earlier…And yet none of this has happened…most economists expect the U.S. to avoid a recession in 2024.”¹

Here are two predictions we’ve seen for 2026:

The U.S. stock market will move higher.During the last week of 2025, some on Wall Street were feeling quite enthusiastic about the year ahead.

“At the big banks and the boutique investment shops, an optimistic consensus has taken hold: the U.S. stock market will rally in 2026 for a fourth straight year, marking the longest winning streak in nearly two decades,” reported Alexandra Semenova and Sagarika Jaisinghani of Bloomberg. “Not a single one of the 21 prognosticators surveyed by Bloomberg News is predicting a decline.”²

The U.S. stock market will move lower.Contrarian investors see high levels of bullishness are a red flag. When a significant majority of investors is optimistic, contrarians tend to be pessimistic, and vice versa. For example, Andy Serwer of Barron’s took a contrarian viewpoint last week:³

“Unlike the usual prognosticators…I’m going to go out on a limb and say the market goes…down…I feel like the bull has been running on fumes a bit lately…between the administration messing with the economy’s biggest industry, healthcare, and brewing labor shortages, growth will surely be hindered.”³

Despite abundant forecasts, it’s not possible to predict the future.

“In a market shaped by unknowable global forces (wars, trade conflicts, etc.) and great innovations (artificial intelligence, miracle weight loss drugs, etc.), it’s simply not credible for anyone to know where the index will land in 12 months to the exact index point. It would take tremendous skill and a great deal of luck to even guess where earnings are going in that period, but the mercurial nature of market sentiment complicates the exercise even further,” explained Jonathan Levin in Bloomberg Opinion.⁴

Major U.S. stock indexes posted attractive returns for 2025, although share prices declined on the last day of the year, reported Alex Veiga of AP News.⁵ For the week, major indexes finished lower.⁶ Yields on most U.S. Treasuries moved higher over the week.⁷

Data as of 1/2/26	1-Week	YTD	1-Year	3-Year	5-Year	10-Year
Standard & Poor’s 500 Index	-1.0%	0.2%	16.9%	21.5%	13.1%	13.0%
Dow Jones Global ex-U.S. Index	0.9	0.9	29.5	14.4	5.1	6.1
10-year Treasury Note (yield only)	4.2	N/A	4.6	3.8	0.9	2.3
S&P GSCI Gold Index	-4.9	-0.3	62.2	32.9	17.3	15.0
Bloomberg Commodity Index	-2.6	-0.2	9.9	-0.3	6.7	3.5

S&P 500, Dow Jones Global ex-US, S&P GSCI Gold Index, Bloomberg Commodity Index returns exclude reinvested dividends. The three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.

Sources: Yahoo! Finance; MarketWatch; djindexes.com; U.S. Treasury.

Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.

THINGS TO WATCH IN 2026. Global financial markets are like a Rube Goldberg machine – affected by a lot of factors in unpredictable ways. Bloomberg evaluated 700 calls from 60 financial institutions regarding the outlook for 2026. Sam Potter of Bloomberg reported on key themes identified in those calls, including:⁸

Artificial intelligence (AI). Optimism about AI is nearly universal, reported Potter. “Astronomical expenditure. Uncertain rates of return. Uneven pace of adoption. By now every firm on Wall Street is well aware of the risks surrounding the artificial intelligence boom. But when it comes to the year ahead, few advocate walking away from what they describe as a ‘revolutionary’ technology.”⁸

Interest rates (a.k.a. monetary policy). Financial markets already anticipate that global central banks will ease monetary policy, which means they will lower rates. The exception is the Bank of Japan. In the United States, “The [Federal Reserve] will come under increased political pressure to cut rates…but most firms think the market is currently pricing too many cuts,” reported Potter.⁸

Government spending and taxes (a.k.a. fiscal policy). “Governments continue to stimulate their economies. In the U.S., the ‘Big Beautiful Bill’ includes tax cuts that should boost growth next year, while Germany has shifted from decades of fiscal restraint to a new era of significant borrowing and investment,” wrote a company cited by Bloomberg.⁸

Tariffs and trade. There was some uncertainty about tariffs. “Although it’s possible the Supreme Court could strike down parts of the Trump administration’s tariff regime, the growing dependence on tariff revenue suggests the authorities will find ways to keep barriers in place,” opined one of the institutions.⁸

Inflation. Overall, institutions expect inflation to remain sticky, although some say it might move lower “Inflation likely to remain above Fed’s target…but could drift down if one-off price increases from tariffs wane or economic activity weakens,” wrote one.⁸

Geopolitics. As global tensions and crises continue, the unified global financial system may fragment, causing friction in the free market system. Potter cautioned that the overall view of institutions was, “…never underestimate the potential for geopolitical or trade-related shocks.”⁸

Depreciating U.S. dollar.Whenthe value of the U.S. dollar falls relative to other countries’ currencies, it can make investments outside the U.S. more attractive than those inside the United States, stated an institution in the survey.⁸

It’s interesting to note that government debt and deficits were not often mentioned. One firm stated, “Although there are many encouraging signs for the year ahead, there are also clear risks on the horizon, and investors should prepare for inevitable market pullbacks. Stocks are expensive. Sticky inflation and mounting government debt in the U.S., Europe and elsewhere are also cause for concern.”⁸

If there are any issues you would like to discuss, please let us know.

WEEKLY FOCUS – THINK ABOUT IT

“Write it on your heart

that every day is the best day in the year.

He is rich who owns the day, and no one owns the day

who allows it to be invaded with fret and anxiety.

Finish every day and be done with it.

You have done what you could.

Some blunders and absurdities, no doubt crept in.

Forget them as soon as you can, tomorrow is a new day;

begin it well and serenely, with too high a spirit

to be cumbered with your old nonsense.

This new day is too dear,

with its hopes and invitations,

to waste a moment on the yesterdays.”⁹

—Ralph Waldo Emerson, Writer and poet