Tuesday's Market Minute: Goodbye, January

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In January, both the S&P 500 (SPX) and Nasdaq-100 (NDX) experienced their worst month since March 2020 when COVID-19 lockdowns began in the U.S., but that didn’t stop the major indices from attempting somewhat of a relief rally at the end of the month.

Over the last couple of trading sessions, the SPX gained 4.4% while the NDX jumped 6.6% as investors bought the dip in tech shares. However, despite the late push higher, all four of the major indices were in the red for January 2022: SPX fell 5.3%, NDX was off 8.5%, Dow Jones Industrial Average ($DJIA) lost 3.3%, and the small-cap Russell 2000 (RUT) ended down 9.7%. Corrections are normal and healthy in bull markets, though.

According to data from Goldman Sachs, there have been 33 corrections of 10% or more in the SPX since 1950, and the median episode has lasted about five months. In the meantime, what does that mean for investors? Multiple guests on the TDA Network have offered advice for how to hedge portfolios in times of high volatility and uncertainty.

Key themes include remaining cautious and level-headed throughout daily turbulence; transitioning to more defensive plays within stocks and bonds; and, if you’re buying on the lows, focusing on high-quality names with strong organic growth.

Today’s focus will be on economic data and earnings. Watch for manufacturing data, Construction Spending, and the JOLTS report this morning. Additionally, quarterly reports from Exxon Mobil Corp XOM, PulteGroup, Inc. PHM, and United Parcel Service, Inc. UPS were released before markets opened, and after the bell, we’ll hear from Advanced Micro Devices, Inc. AMD, Alphabet Inc. GOOGL, Electronic Arts Inc. EA, General Motors Company GM, Paypal Holdings Inc. PYPL, and Starbucks Corporation SBUX.

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This post contains sponsored advertising content. This content is for informational purposes only and not intended to be investing advice.