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Annual OutlookJanuary 13, 2026

2026 Market Outlook – Are We There Yet?

Last year, markets and the economy defied gravity, climbing higher even as elevated interest rates generated heavy drag. Equities soared, duration suffered, and businesses remained remarkably healthy. Now, in 2025, we stand at Gravity’s Edge, a horizon where segments of the market will be tested to assess which have the thrust to achieve escape velocity, propelling further growth, and what areas risk burning up upon reentry.

2026 Market Outlook – Are We There Yet?

It’s the classic road trip question, and over the past few years has doubled as the soundtrack of investing. Every bump in the pavement has investors tightening their seatbelts in anticipation of hitting the brakes. We’ve faced blaring recession warnings, predictions that the Magnificent 7 would skid out, concerns that tariffs would stall out the consumer, mounting deficit worries, calls for an imminent AI bubble pop, and speculation that the Fed’s independence was slipping. Through all of it, the same behavioral chorus kept echoing: surely this must be the end of the road.

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Research & Insights | Waterloo Capital