After a strong performance in 2025 the S&P 500 (SPY) is off to a good start in 2026. The leading index gained 1.5% in January. The Dow Jones Industrial Average (DIA) gained 2.6%. International stocks led the way, with the Vanguard International Index Fund (VEU) up 6.1% in January. The Nasdaq 100 (QQQ) gained 1.6%. Take a look at the chart below.
*chart from tradingview.com
Here’s What I Expect from S&P 500 in February: Stocks are off to a good start in 2026. But in the short run the S&P 500 is moving into a slower month historically. September and February are the only two months of the year that average a negative return since 1950, the last 20 years and the last 10 years. Here is a cool chart from financial research firm Carson Research.
The Strong January Signals High Probability of More Gains: The strong start to 2026 for the S&P 500 signals a high probability of more gains this year. According to a study from Carson Research, when the S&P 500 is up more than 1% in the first five days of January and higher for the full month in January, the full year is higher 92% of the time with an average gain of 18%. Take a look at the cool chart below.
The Big Picture on the S&P 500: The S&P 500 is off to a good start in 2026 and that signals a high probability of more gains this year. In the short run February has a history of being a slower month for stocks. However, further out, the outlook for US and global stocks is strong due to momentum from 2025 and the strong start to 2026.
I’ll be back with another update next week – have a great day!
