January 2026 Investylitics

Horizon Advisor Network Investment Committee January 8, 2026

Executive Summary

2025 marked the third year in a row of double-digit returns for U.S. stock markets as measured by the S&P 500 index. This happened despite a nearly 20% market downturn earlier in the year. This should be a reminder to stay invested and not try to time the market's short-term moves based on emotion or sentiment.
2025 was also a year in which diversification paid off for investors. International stocks, emerging-market stocks, and precious metals, such as gold, silver, and copper, all outperformed U.S. stocks.
As we look to the new year, there is significant economic optimism factored into the outlooks of the economists and market strategists we follow. Many believe we are heading toward a stronger first half of the year, driven by fiscal stimulus from the recent tax law change, which could lead to larger tax refunds and more consumer spending, combined with potentially lower interest rates from the Federal Reserve.
The arrest of Venezuelan President Nicolás Maduro by U.S. forces represents an unexpected and significant geopolitical event. History provides important context: geopolitical events often create short-term market volatility, but their long-term market impact tends to be limited.
After multiple years of strong returns in the markets and in client portfolios, it is easy for investors to begin to expect these types of returns in the future. While we are always happy with periods of strong performance, we know that trees don't grow to the sky and markets don't go up forever. We should always use times like this to create liquidity and prepare for future volatility or downturns.

The Horizon Advisor Network Investylitics Committee members met on the afternoon of Thursday, January 8th. As we turned the page to a new year, we were happy to have the opportunity to review the research from the various market strategists and economists that the committee follows. We also discussed the potential impact of recent geopolitical events in Venezuela on the economy and the markets.

2025 marked the third year in a row of double-digit returns for U.S. stock markets, as measured by the S&P 500 index. What started out as a year marked by trade/tariff tensions, ongoing geopolitical events in the Middle East and Eastern Europe, and plenty of uncertainty about the path of inflation and Federal Reserve policy ended on a strong note, with optimism for the economy as we look to the first half of 2026. As shown in our first chart below, major market averages experienced downturns of nearly 20% or more, only to rebound substantially. This should serve as a reminder to stay invested and not try to time the market's short-term moves based on emotion or sentiment.

2025 was also a year in which diversification paid off for investors. International stocks, emerging-market stocks, and precious metals, such as gold, silver, and copper, all outperformed U.S. stocks. International stocks beat the US in 2025, with MSCI EAFE up 31.2% vs the S&P 500's 17.9% gain. As you can see in the chart below, it was only the 4th time in 16 years that international stocks outperformed, and it was the widest gap since 1993. The US economy is resilient, but diversification is working again. This is why the committee members strongly believe in staying disciplined with your diversification over time.

As we look to the new year, there is significant economic optimism factored into the outlooks of the economists and market strategists we follow. Many believe we are heading toward a stronger first half of the year, driven by fiscal stimulus from the recent tax law change, which could lead to larger tax refunds and more consumer spending, combined with potentially lower interest rates from the Federal Reserve. There is also the potential for deregulation and business investment incentives from the recent tax bill to spur more investment and job creation.

We have started to see this reflected in economic data, such as the Bureau of Labor Statistics' productivity report released earlier today. It showed that nonfarm business sector labor productivity increased 4.9 percent in the third quarter of 2025, versus 1.9% in the same quarter a year ago. This indicates that some of the recent massive investments in tech and AI may be starting to pay benefits. We also saw the Atlanta Federal Reserve Bank release its GDPNow report, a real-time GDP tracker based on high-frequency data. As of January 8th, it projects fourth-quarter economic growth at 5.4% after updates to personal consumption expenditures and net exports. This comes after the U.S. economy grew robustly in the third quarter of 2025, with real GDP increasing by 4.3% at an annual rate.

The arrest of Venezuelan President Nicolás Maduro by U.S. forces represents an unexpected and significant geopolitical event. As has been widely reported, the U.S. military successfully conducted an operation that detained Maduro on charges related to drug trafficking and corruption. While the humanitarian and geopolitical implications for the Venezuelan people and the region are most important, investors may naturally wonder what all these issues mean for their portfolios. History provides important context: geopolitical events often create short-term market volatility, but their long-term market impact tends to be limited. This is because these events don't typically change the direction of broad economic and market drivers, even if oil production is affected. This has certainly been true of geopolitical conflicts in recent years, including in Ukraine and the Middle East, as shown in our last chart below.

Finally, after three consecutive years of strong returns in markets and client portfolios, investors may begin to expect these returns in the future. We are always happy with periods of strong performance. However, we know that trees don't grow to the sky and markets don't go up forever. We should always use times like this to create liquidity and prepare for future volatility or downturns. While there are reasons for optimism regarding the economy in the coming months, we know that the economy and markets are not one in the same and don't always move in lockstep.

The committee continues to appreciate your trust and confidence in our team and our process. As always, we are here for you. If you have questions about your family's situation or financial planning goals, please reach out to us. Thanks, and make it a great day!

The views stated in this piece are not necessarily the opinion of Cetera Advisors LLC and should not be construed directly or indirectly as an offer to buy or sell any securities. Due to volatility within the markets, opinions are subject to change without notice. Information is based on sources believed to be reliable; however, their accuracy or completeness cannot be guaranteed. Past performance does not guarantee future results.

Investors cannot invest directly in indexes. The performance of any index is not indicative of the performance of any investment and does not take into account the effects of inflation and the fees and expenses associated with investing.

A diversified portfolio does not assure a profit or protect against loss in a declining market.

Additional risks are associated with international investing, such as currency fluctuations, political and economic stability, and differences in accounting standards.

Cetera does not offer direct investments in gold/silver/cooper (commodities). Commodities are volatile investments and may not be suitable for all investors.

The Russell 2000 is a stock-market index measuring the performance of 2000 small-capitalization stocks. It represents the 2000 smallest companies in the Russell 3000 Index, which in turn represents the 3000 largest companies in the U.S. Thus, the Russell 2000 is a barometer of small-cap stocks. Though small, the companies represented by the Russell 2000 are not the smallest of the small as they are not penny stocks. The Russell 2000 is weighted by the market capitalization of the stocks.

MSCI EAFE – Designed to measure the equity market performance of developed markets (Europe, Australasia, Far East) excluding the U.S. and Canada. The Index is market-capitalization weighted.

INVESTYLITICS TEAM OF HORIZON ADVISOR NETWORK

Jesse Hurst - Senior Wealth Manager - Chair, Impel Wealth Management

Nathan Ollish - Senior Financial Advisor - Impel Wealth Management

Clint Gautreau, Financial Advisor - Horizon Financial Group

Kevin Myers, Financial Advisor - ATL Global

Grace Hayden MacNaught, Financial Advisor - The Planning Studio

Dusty Green, Financial Advisor - Spencer Financial Inc.

Sincerely,
Jesse W. Hurst, CFP®, AIF®
Senior Financial Planner and CEO

*Award Recipient Jesse Hurst

Forbes: Best-in-State Wealth Advisors Award received by Jesse Hurst, Senior Wealth Advisor, (2018-2024). The Forbes ranking of Best-In-State Wealth Advisors, developed by SHOOK Research, is based on an algorithm of qualitative data, rating thousands of wealth advisors with a minimum of seven years’ experience and weighing factors like revenue trends, assets under management, compliance records, industry experience, and best practices learned through telephone and in-person interviews. Portfolio performance is not a criteria due to varying client objectives and lack of audited data. Neither Forbes nor SHOOK receive a fee in exchange for rankings. Research summary as of April 2024: - 44,990 nominations received, based on thresholds - 23,876 invited to complete online survey - 20,412 telephone interviews - 4,926 in-person interviews at Advisor's location - 1,507 virtual interviews. Listing in this publication and/or award is not a guarantee of future investment success. This recognition should not be construed as an endorsement of the advisor by any client. No compensation was provided directly or indirectly by the recipient for participation or in connection with obtaining or using the third-party rating or award.

¹ This recognition and the due–diligence process conducted are not indicative of the advisor's future performance. Your experience may vary. Winners are organized and ranked by state. Some states may have more advisors than others. You are encouraged to conduct your own research to determine if the advisor is right for you.

² Portfolio performance is not a criterion due to varying client objectives and lack of audited data. SHOOK does not receive a fee in exchange for rankings.