Stocks ended last week with modest losses after a volatile five days of market-moving economic data, geopolitics, and Fed drama. The Standard & Poor’s 500 Index slid 0.38 percent, while the Nasdaq Composite Index skidded 0.66 percent. The Dow Jones Industrial Average edged down 0.29 percent. By contrast, the MSCI EAFE Index, which tracks developed overseas stock markets, rose 1.41 percent.1,2 Choppy Trading Stocks started the week lower after pre-opening bell news that the Justice Department had launched a criminal investigation into Federal Reserve Chair Jerome Powell. A statement issued Tuesday morning by central bankers worldwide helped tamp down market volatility.3,4 The White House called for a 10 percent cap on credit card interest rates for 1 year, putting pressure on financial stocks. Meanwhile, news that headline inflation matched forecasts while core inflation came in cooler than expected was well received by investors.5,6 Despite solid retail sales and wholesale inflation reports for November, stocks were under pressure on Wednesday due to geopolitical tensions and disappointing Q4 results from a handful of financial stocks.7 Then chip manufacturers and banks led a rebound, recouping most of the week’s losses. Markets opened higher on Friday but then slid after President Trump changed the optics on his preferred candidate to be the next Fed Chair. His comments led investors to believe that his new choice would be more market-friendly but perhaps less likely to adjust interest rates lower in the future. On a weekly basis, gold closed higher driven by safe-haven flows and geopolitical concerns further supported by lingering risk aversion and geopolitical tensions, but late-week softness emerged as stronger U.S. economic indicators boosted the dollar and reduced expectations for imminent Fed interest rate cuts. Gold and Silver are again rallying to begin the week on new tariffs on several major European nations (including France, Germany, the U.K., and others) unless Greenland is sold to the U.S. Markets interpret this as escalating global trade tensions and potential trade retaliation, which can hurt corporate profits and economic growth. This kind of policy risk typically weighs on sentiment and equity futures. Ethereum outperformed Bitcoin for solid gains last week in the crypto space, but Bitcoin is trading lower into Sunday evening on the potential new tariffs and once again Bitcoin is not trading as a store of value or safe haven like gold. Global investors are pouring into the "Hard Rock" Cafe and precious metals party Dynamic forces will shape the markets in critical materials and other metals in 2026 and beyond with ten critical macro and market themes investors should watch in the coming year. Here are the top 10 themes for 2026: #1. Deglobalization: The Structural Shifts Reshaping Markets Deglobalization has accelerated into a defining force reshaping global markets and in 2026 this theme is expected to deepen and broaden across economic, geopolitical and investment landscapes. The old global order is dissolving, marked by aggressive geopolitical maneuvers and rising tensions that are destabilizing the international system. If you are not working with an astute and seasoned investment advisor who understands markets and changing dynamics, call us if you are not already a valued client of Castle Financial. Partner with a Certified Financial Fiduciary at Castle Financial - Email julie@castlefinancial.com or call us at 732-888-4994 to schedule a complimentary 30 minute consultation and second opinion. |
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Source: YCharts.com, January 17, 2026. Weekly performance is measured from Monday, January 12, to Friday, January 16. TR = total return for the index, which includes any dividends as well as any other cash distributions during the period. Treasury note yield is expressed in basis points. |
Fed DramaTensions between the White House and the Federal Reserve escalated last week after the Justice Department issued a criminal indictment against Fed Chair Powell. Powell, typically stone-faced, posted an assertive video last Sunday night after he ignored many inquiries by U.S. Attorney Pirro regarding billions of dollars in question on elaborate Fed offices projects. However, by the close of the week investors seemed to have moved past the Fed drama as there was plenty of other news to follow. This week: Key Economic DataWednesday: Construction Spending* (Nov). Pending Home Sales. Thursday: Weekly Jobless Claims. Gross Domestic Product, Q3 (first revision). Personal Consumption & Expenditures (PCE) Index* (Nov). Friday: Consumer Sentiment. Purchasing Managers’ Index (PMI)—Services & Manufacturing. * indicates publication of a report delayed by the government shutdown in October and November Source: Investors Business Daily - Econoday economic calendar; January 16, 2026. The Econoday economic calendar lists upcoming U.S. economic data releases (including key economic indicators), Federal Reserve policy meetings, and speaking engagements of Federal Reserve officials. The content is developed from sources believed to provide accurate information. The forecasts or forward-looking statements are based on assumptions and may not materialize. The forecasts are also subject to revision. This Week: Companies Reporting EarningsTuesday: Netflix, Inc. (FLIX), Interactive Brokers Group, Inc. (IBKR), 3M Company (MMM), U.S. Bancorp (USB) Wednesday: Johnson & Johnson (JNJ), The Charles Schwab Corporation (SCHW), Prologis, Inc. (PLD) Thursday: Procter & Gamble Company (PG), GE Aerospace (GE), Intel Corporation (INTC), Abbott Laboratories (ABT), Intuitive Surgical (ISRG), Capital One Financial Corporation (COF) Source: Zacks, January 16, 2026. Companies mentioned are for informational purposes only. It should not be considered a solicitation for the purchase or sale of the securities. Investing involves risks, and investment decisions should be based on your goals, time horizon, and risk tolerance. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost. Companies may reschedule their earnings reports without notice. |
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"As you get older your willingness to tell more of the truth is awakened and you don't have to think about it or imagine it because now you know this to be true." – Keith David |
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Tax Tips for Those in the MilitaryThe Internal Revenue Service has certain special tax breaks and programs for members of the U.S. Armed Forces. Earned Income Tax Credit Signing Joint Returns This information is not a substitute for individualized tax advice. Please consult with a qualified tax professional to discuss your specific tax issues. Tip adapted from IRS.gov9 |
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Stay Healthy During Flu SeasonConventional wisdom holds that flu season occurs in Fall and Winter, but the truth is it can vary widely from year to year and region to region. Fortunately, you may reduce your risk this coming flu season with a few simple steps. ● Get the flu vaccination: While getting the vaccine may not prevent you from getting a strain of the flu, it may help you avoid one of the other strains. This is especially important for anyone with a chronic health condition and those 65 and older. While this information should not substitute for medical advice from your healthcare provider, adopting better habits, such as frequent handwashing, wearing a face mask, and avoiding anyone who is ill, may help you and your loved ones stay healthy this flu season. Tip adapted from Centers for Disease Control10 |
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My three eyes blink, and I give you commands. Although I can’t see, the changing colors in me prompt you to obey me with your wheels, feet and hands. What am I? Last Week's Riddle: You can separate them with a word, yet they are mostly inseparable. What are they? Answer: Your lips. |
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Red Panda (Ailurus fulgens) Rhenen, Netherlands |
Footnotes And Sources 1. WSJ.com, January 16, 2026 |
Investing involves risks, and investment decisions should be based on your own goals, time horizon, and tolerance for risk. The return and principal value of investments will fluctuate as market conditions change. When sold, investments may be worth more or less than their original cost.
The forecasts or forward-looking statements are based on assumptions, may not materialize, and are subject to revision without notice.
The market indexes discussed are unmanaged, and generally, considered representative of their respective markets. Index performance is not indicative of the past performance of a particular investment. Indexes do not incur management fees, costs, and expenses. Individuals cannot directly invest in unmanaged indexes. Past performance does not guarantee future results.
The Dow Jones Industrial Average is an unmanaged index that is generally considered representative of large-capitalization companies on the U.S. stock market. The Nasdaq Composite is an index of the common stocks and similar securities listed on the Nasdaq stock market and considered a broad indicator of the performance of stocks of technology and growth companies. The MSCI EAFE Index was created by Morgan Stanley Capital International (MSCI) and serves as a benchmark of the performance of major international equity markets, as represented by 21 major MSCI indexes from Europe, Australia, and Southeast Asia. The S&P 500 Composite Index is an unmanaged group of securities that are considered to be representative of the stock market in general.
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