Weekly Market Commentary

January 21, 2026

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.”

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.
• A Treasury market shake-up. The yield on benchmark 10-year U.S. Treasuries rose to 4.24 percent 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.

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.”

• Good news on prices. The rate of inflation didn’t fall to the Federal Reserve’s target level of two percent in December, 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).

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 

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

S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and 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; London Bullion Market Association. 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. 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.

1) What is “net worth”?

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

2) When a news story says a company is raising “capital”, what is it trying to do?

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

3) Which of the following is slang meaning “one dollar”?

A. Sawbuck

B. Simoleon

C. Benjamin

D. C-note

4) Which of the following slang terms does NOT imply wealth, refinement, or upper-class status?

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”

― Thich Nhat Hanh, Author