As Goes January, So Goes the Year?
The LPL Strategic & Tactical Asset Allocation Committee (STAAC) determines the firm’s investment outlook and asset allocation that helps define LPL Research’s investment models and overall strategic and tactical investment thinking and guidance. The committee is chaired by the chief investment officer and includes investment specialists from multiple investment disciplines and areas of focus. The STAAC meets weekly to closely monitor all global economic and capital markets conditions to ensure that all the latest information is being digested and incorporated into its investment thought.
Key changes from January report:
- Upgraded large growth to strong overweight, downgraded small value to underweight.
- Upgraded consumer discretion ary to overweight, downgraded materials to underweight.
Investment Takeaways
Equity markets gained ground in January, bouncing back from a mostly lower December and triggering the January barometer that bodes well for 2025 performance. Developments out of Washington dominated headlines as President Trump was sworn in for his second term, going straight to work with a deluge of executive orders. Markets benefitted from continued deregulation dynamics and animal spirits, although a cloudy backdrop around lingering tariff concerns remained in play. In markets, semiconductor names and the broader artificial intelligence (AI) theme took a hit near month’s end after Chinese AI startup DeepSeek roiled global markets with its low-cost model.
Elsewhere, earnings season takeaways were mostly positive, highlighted by banks broadly topping estimates and a mixed batch of initial big tech results.
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IMPORTANT DISCLOSURES
Investing in foreign and emerging markets securities involves special additional risks. These risks include, but are not limited to, currency risk, geopolitical risk, and risk associated with varying accounting standards. Investing in emerging markets may accentuate these risks. All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy. Precious metal investing involves greater fluctuation and potential for losses.
Earnings per share (EPS) is the portion of a company’s profit allocated to each outstanding share of common stock. EPS serves as an indicator of a company’s profitability. Earnings per share is generally considered to be the single most important variable in determining a share’s price. It is also a major component used to calculate the price-to-earnings valuation ratio.
Gross Domestic Product (GDP) is the monetary value of all the finished goods and services produced within a country’s borders in a specific time period, though GDP is usually calculated on an annual basis. It includes all of private and public consumption, government outlays, investments and exports less imports that occur within a defined territory.
All index data from FactSet.
The Strategic and Tactical Asset Allocation Committee (STAAC) is a division of LPL Research.
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