As 2026 kicks off, we find ourselves in much the same spot where 2025 ended. Key U.S. averages are holding and consolidating above important moving averages. Global equities continue to outperform. And once again, narrative based investing proves to be a fool’s game — this time we’ll let crude oil make the point for us.
S&P 500 and NASDAQ 100
Both major indices finished last week lower. While each remains above rising 60-week moving averages, neither has made meaningful progress since October. There have been plenty of tactical opportunities inside that range, but in the bigger picture, the market is still digesting the powerful move off the April lows.
A pause that refreshes is bullish — unless it breaks lower with confirmation.
Source: Optuma
S&P 500 Equal Weight Index
Participation remains broad, with the Equal Weight S&P 500 holding near record levels. This remains the simplest, cleanest rebuttal to the lazy “it’s only seven stocks” bear case.
Source: Optuma
Global Stocks
For the fifth time in six weeks, the iShares MSCI ACWI ex U.S. ETF (ACWX) closed above where it opened. Last week marked the second straight week where the bull's carried momentum into the weekend.
This is arguably the most impressive chart in global equities right now — especially after a textbook hold of the rising 10-week moving average three weeks ago.
Source: Optuma
Semiconductors
The PHLX Semiconductor Index kicked off the year with a strong up day. Like the major U.S. averages, semis have been consolidating since October.
A break to new highs — both on an absolute and relative basis (see lower panel) — would likely pave the way for broader market strength.
Source: Optuma
Crude Oil
Venezuela dominated energy headlines over the weekend. The market knows the country has large proven reserves, and the consensus narrative is already forming: more supply is coming; crude prices must fall.
So far, that narrative isn’t worth much. Below is a one minute chart of front month crude since January 1st — not exactly a collapse.
Would it not be poetic if the “major event” everyone talked about ends up marking the low of the year?
Source: Optuma
Final Thoughts
The market spent the past few months digesting a powerful run off the April lows, and the early action in 2026 tells the same story: the underlying trend hasn’t changed. U.S. equities are consolidating constructively, participation remains broad, and global markets continue to lead with authority. Semiconductors are tightening up for what could be the next leg higher, and narratives are still a poor way to invest.
New year, same market. And the market is still telling the same story.
Dan Russo, CMT
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