The Stock Market’s Rocky Start to 2026
Traders kicked off the new year on Wall Street with a familiar scene. Peter Tuchman sported “2026” glasses as the opening bell rang at the New York Stock Exchange on December 31, 2025. But the celebration didn’t last long.
A Split Market Returns
The first trading day of 2026 revealed a stock market divided against itself. While the S&P 500 started higher thanks to semiconductor stocks, it quickly lost momentum and dipped into negative territory. By midday, the index was down 0.1%, showing just how fragile investor confidence remains.
Winners and Losers Emerge
Looking closer at market sectors reveals the split personality of stocks. Five sectors gained ground, led by industrials, energy, and utilities – each climbing over 1%. But six sectors fell behind, with consumer discretionary and communication services taking the biggest hits. This tug-of-war between different parts of the economy defined the trading session.
The Rotation Game Continues
This isn’t new – traders have been shifting their money around for months. After riding the AI wave that dominated the past three years, investors now worry tech stocks might struggle in 2026. They’re moving cash into other sectors, hoping to find safer places for their money.
Tech Takes a Hit
The Nasdaq Composite, packed with tech companies, finished 2025 with two straight months of losses. That’s a warning sign flashing for investors who’ve relied on tech to drive market growth.
What Experts Predict
Market experts think this rotation could actually be healthy long-term. They expect companies tied to economic growth – not just tech – to lead gains in 2026. But this shift comes with a cost: the CNBC Market Strategist Survey predicts the S&P 500 will climb just 11% this year – decent, but nowhere near the jumps we’ve seen recently.
Caution Lights Flash
Some experts are sounding alarms. Bank of America strategist Savita Subramanian warns stocks look expensive right now, saying “risks to the index abound in 2026.” Her prediction of 7,100 for the S&P 500 is among the most cautious on Wall Street.
Adam Parker from Trivariate Research shares the concern, noting: “I think the consensus is pretty bullish. You’re betting on strong earnings growth, and I don’t know if that’s as likely.”
Chip Stocks Shine Bright
One standout area? Semiconductor companies. While most tech struggled, chipmakers delivered gains. Nvidia rose 1.5% – the only member of the “Magnificent Seven” tech giants in positive territory. The VanEck Semiconductor ETF jumped nearly 3%, with Micron surging over 7% and AMD climbing 3%. These chip specialists show that even in a tough market, some tech segments still spark excitement.
