Insight Into 2026

Analyzing the markets with Richie Naso, a Wall Street veteran of over 40 years and former member of the NYSE.

• DJIA 52-wk: +13.22% | YTD: +0.66% | Wkly: -0.67%
• S&P 500 52-wk: +15.41% | YTD: +0.19% | Wkly: -1.03%
• NASDAQ 52-wk: +18.42% | YTD: -0.03% | Wkly: -1.52%
• State Street SPDR S&P Bank ETF 52-wk: +9.92% | YTD: +0.79% | Wkly: -1.67%

Major Index Performance

Holiday-shortened trading saw mixed action and modest weakness in major U.S. indexes:

The S&P 500, Dow Jones, and Nasdaq ended lower over the week, influenced by light holiday trading and profit-taking as 2025 closed out. Reuters

On the first official trading day of 2026 (Jan 2), the Dow and S&P 500 rebounded, while the Nasdaq lagged slightly. Reuters

End-of-year context:

The S&P 500 finished 2025 with another double-digit gain, completing its third consecutive year of strong performance. Morningstar

Market Drivers Last Week

Low Liquidity & Holiday Thin Trading

Markets were quiet with low volumes due to Christmas/New Year holidays, meaning price moves were less reliable and driven more by sentiment than fundamental catalysts. DailyForex

Sector Trends

Defensive value sectors like utilities, energy, and industrials outperformed growth during the week as investors rotated away from expensive tech in thin markets. Reuters

Technology and mega-cap AI-linked stocks remained key drivers of broader gains in 2025 overall but saw some relative weakness late in the week. Reuters

Investor Sentiment

The classic Santa Claus rally — a festive period tendency for markets to rise — didn’t clearly materialize, with many indices ending slightly lower during the final trading sessions of 2025. Wikipedia

On the flip side, early trading in 2026 showed signs of support, consistent with occasional January barometer optimism that early gains could set the tone for the year ahead. Wikipedia

Economic & Policy Context

With light data releases and no major Fed speakers over the week, monetary policy expectations for 2026 (including anticipated rate cuts later in the year) remained a backdrop but didn’t drive sharp moves during the holiday week. LinkedIn

Treasury yields were slightly higher, and commodities like gold and natural gas saw notable gains over the period. LinkedIn

Summary

Week of Dec 28 2025 – Jan 1 2026:

✔ Markets traded with thin liquidity and lacked strong direction.

✔ Major U.S. indexes finished modestly lower for the week but remained strong from a year-end viewpoint.

✔ Early 2026 trading hinted at rebound potential for Dow and S&P 500, though tech lagged.

✔ Broader macro catalysts (Fed policy, earnings calendar) are still poised to shape market direction as the year progresses.

SINCE 2019:

Motor Vehicle insurance is +56%, Auto maintenance & repair +50% & Coffee +46%

SILVER:

Is going ballistic and trading at 130.00 in Tokyo for the physical.

Tesla dethroned as the world's top EV maker:

Elon Musk's Tesla is no longer the top electric vehicle seller in the world as demand at home has cooled while competition heated up abroad.

Tesla lost its pole position after reporting 1.64 million deliveries in 2025, roughly 620,000 fewer than Chinese competitor BYD.

Tesla struggled last year amid increasing competition, waning federal support for electric vehicle adoption and brand damage triggered by Musk's stint in the White House.

Musk is turning his focus toward robotics and autonomous driving technology in an effort to keep Tesla relevant as its EVs lose popularity.

On Friday, the company reported lower than expected delivery numbers for the fourth quarter of 2025, a decline from the previous quarter and a year-over-year decrease of 16%. Tesla delivered 418,227 vehicles in the fourth quarter and produced 434,358.

According to a company-compiled consensus from analysts posted on Tesla's website in December, the company was projected to deliver nearly 423,000 vehicles in the fourth quarter.

Tesla's annual deliveries fell roughly 8% last year from 1.79 million in 2024. Its third-quarter deliveries saw a boost as consumers rushed to buy electric vehicles before a $7,500 tax credit expired at the end of September.

"There are so many contributing factors ranging from the lack of evolution and true innovation of Musk's product to the loss of the EV credits," said Karl Brauer, an analyst at iSeeCars.com. "Teslas are just starting to look old. You have a bunch of other options, and they all look newer and fresher."

BYD is making premium electric vehicles at an affordable price point, Brauer said, but steep tariffs on Chinese EVs have effectively prevented the cars from gaining popularity in the U.S.

Other international automakers like South Korea's Hyundai and Germany's Volkswagen have been expanding their EV offerings.

In the third quarter last year, the American automaker Ford sold a record number of electric vehicles, bolstered by its popular Mustang Mach-E SUV and F-150 Lightning pickup truck.

In October, Tesla released long-anticipated lower-cost versions of its Model 3 and Model Y in an attempt to attract new customers.

However, analysts and investors were disappointed by the launch, saying the models, which start at $36,990, aren't affordable enough to entice a new group of consumers to consider going green.

As evidenced by Tesla's continuing sales decline, the new Model 3 and Model Y have not been huge wins for the company, Brauer said.

"There's a core Tesla following who will never choose anything else, but that's not how you grow," Brauer said.

Tesla lost a swath of customers last year when Musk joined the Trump administration as the head of the so-called Department of Government Efficiency.

Left-leaning Tesla owners, who were originally attracted to the brand for its environmental benefits, became alienated by Musk's political activity.

Consumers held protests against the brand and some celebrities made a point of selling their Teslas.

Although Musk left the White House, the company sustained significant and lasting reputation damage, experts said.

Investors, however, remain largely optimistic about Tesla's future.

Shares are up nearly 40% over the last six months and have risen 16% over the past year.

Brauer said investors are clinging to the hope that Musk's robotaxi business will take off and the ambitious chief executive will succeed in developing humanoid robots and self-driving cars.

The roll-out of Tesla robotaxis in Austin, Texas, last summer was full of glitches, and experts say Tesla has a long way to go to catch up with the autonomous ride-hailing company Waymo.

Still, the burgeoning robotaxi industry could be extremely lucrative for Tesla if Musk can deliver on his promises.

"Musk has done a good job, increasingly in the past year, of switching the conversation from Tesla sales to AI and robotics," Brauer said. "I think current stock price largely reflects that."

Shares were down about 2% on Friday after the company reported earnings.

Why Oil Stocks Are Worth a Bet in 2026

Oil prices are already reflecting loads of bad news—and oil stocks have lagged behind the market. Buying them now makes sense in the face of some tailwinds that could commence soon.

For oil, everything that could go wrong has gone wrong. Overproduction has been an issue, with both U.S. producers and OPEC+ nations drilling more than the economy could handle. At the same time, China has boosted its strategic reserves, suggesting weaker demand. A slowing U.S. jobs market has also forced investors to question the demand side of the equation despite consistently higher gross-domestic-product growth. WTI Crude, the U.S. benchmark, has dropped 19% this year to a recent $58. Strategists at Bank of America forecast oil to trade around an average of $60 in 2026, down from $69 in 2025.

You wouldn’t know it from looking at oil stocks. The State Street Energy Sector SPDR exchange-traded fund has gained 8.5% in 2025, including reinvested dividends, less than the S&P 500’s 19% rise but surprisingly solid given crude’s decline. Some of that strength was due to Exxon Mobil, which makes up 24% of the portfolio and returned 17% this past year, while refiners like Phillips 66, Valero Energy, and Marathon Petroleum also provided a boost.

This coming year might even be better. For one, oil prices might not fall much more. Despite recent negative headlines, oil futures continue to find a floor at around $55, a level hit last April and this month. It could be a sign the market expects the oil picture to improve—countries won’t add supply forever and demand could easily brighten—or at least not get any worse. Federal Reserve interest-rate cuts, if they materialize, could also provide a boost, especially if they cause the economy to overheat.

“It’s such a lower bar for oil next year for any type of upside,” says Adam Turnquist, chief technical strategist at LPL Financial, who expects stronger economic growth to be a catalyst for oil.

He’s not alone. Truist Chief Investment Officer Keith Lerner is sticking by his December upgrade of S&P 500 energy stocks. “We’re at a point where even a little bit of good news could go a long way,” he says.

But the fact that oil stocks have done so well in a rough environment could also be a sign that the sector’s makeover is working. No longer simply a bet on the direction of oil prices, the companies now have the balance sheets and free cash flow to buy back shares and grow their dividends, helping investors earn an acceptable total return.

I expect the first week of the year to be positive.After that I become cautious.Also keep in mind that Midterm election years historically tend to be muted or modest for the U.S. stock market — not terrible, but usually weaker than average.

I believe it’s all about the earnings going forward.

****Remember what happens in January usually sets the tone for the whole year.

— Richie

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