Market Commentary – January 2019

U.S. stocks jumped sharply in January after hitting a 12-month low on December 24th. Fears of an imminent recession and protracted trade war with China were severely overblown and this pullback in equity markets provided a unique buying opportunity. Corporate earnings reports in January were also not nearly as bad as many had predicted. While earnings growth will likely slow in the long-run, many market pundits had become far too negative. Further support for the rally came on January 30th when the Federal Reserve adopted a more dovish “wait and see” attitude towards future interest rate rises, which should also benefit stocks going forward.