Fundstrat’s head of technical strategy, Mark Newton, has warned that 2026 could prove to be a challenging year for the stock market.
During a recent interview on Thoughtful Money, Newton highlighted several negative factors that could impact the market in the coming year.
“I believe we are gearing up for a more volatile year compared to previous ones. With three consecutive years of over 15% gains, including two years with over 20% growth and last year’s 17% increase, we might be in for a bumpy ride. Historically, mid-term election years tend to be the weakest within the four-year presidential cycle.”
Newton anticipates a downward trend starting from late February, potentially extending until October, although he acknowledges that the decline won’t be linear.
“I foresee a possible 15-20% decline, beginning in late February or early March, and lasting until May or June, followed by a summer rally. However, a correction in the third quarter could signal the end of this consolidation phase.”
The strategist pointed out the rising levels of optimism in market sentiment and predicted a speculative peak by the end of the month. He also observed a slowdown in momentum among tech giants, suggesting that the tech sector could experience some weakness this year.
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