Trust Investment Management
Markets began 2026 on generally solid footing, though January included some normal ups and downs along the way. Investors spent much of the month weighing incoming economic data alongside shifting expectations around interest rates and global developments. Rather than following a single clear narrative, markets adjusted incrementally as new information emerged.
January equity returns reflected broad participation across markets, with notable strength in smaller company stocks and international equities. Performance varied across segments, highlighting a shift away from narrowly concentrated leadership. In practical terms, market gains were not driven by just a small group of well-known stocks. Some areas that had led in prior periods slowed, while other parts of the market picked up momentum, creating a more balanced pattern of returns.
Bond markets were mixed during the month as interest rates adjusted. Short-term bond prices moved in response, which is normal when rates change. Even though yields have come down from prior peaks, they remain meaningfully higher than they were for much of the past decade, allowing bonds to contribute through income while also helping manage overall portfolio volatility.
January also reinforced the value of diversification. Different asset classes, regions, and market segments moved independently as conditions evolved, helping reduce reliance on any single market outcome. This type of variation is an intentional feature of diversified portfolios and can help manage risk during periods of uncertainty.
As the year gets underway, markets appear to be operating in a more typical environment, one driven less by extraordinary policy measures and more by underlying fundamentals. Short-term market swings are likely to remain part of the landscape, but long-term investment progress has historically come from staying disciplined, diversified, and focused on long-term goals rather than reacting to headlines.
