By: Editorial Team, StoneX Media
Market seasonality is drawing renewed attention as investors weigh what January’s performance could imply for the rest of 2026. As of February 3, 2026, one of the most referenced seasonal signals remains the January Barometer, which links the first month’s return to full-year probabilities. The significance is not that market seasonality can guarantee an outcome, but that recurring calendar patterns can influence how markets price risk and momentum.
Michael Lytle, Chief Investment Officer at StoneX Wealth Management, has tested market seasonality signals by reviewing S&P 500 outcomes back to the index’s early history in the 1920s. His point of view is shaped by comparing full-history results with post World War Two slices, showing how window selection can change the apparent strength of seasonality signals.
Market seasonality remains relevant because early performance can change how investors assess the distribution of outcomes for the year ahead. Lytle said that looking back through S&P 500 history, "it's positive on an annual basis, a little over 70% of the time when January has a positive return", reinforcing why the January Barometer still frames expectations. Consequently, market seasonality can tighten the narrative around risk taking after a strong January, pushing investors to treat momentum as an informational signal. In contrast, he stressed that the indicator should be treated as odds, not certainty, because the market has produced meaningful exceptions across the record.
Market seasonality analysis can look stronger or weaker depending on which historical window investors choose, and that choice can change conclusions. Lytle cautioned that "averages can conceal a lot and they're certainly no guarantee", noting that there have been years where January was positive with “hugely negative returns,” and also “big positive years” when January was negative. As a result, market seasonality should be used as a risk-framing input rather than a standalone decision rule, especially when positioning and narratives can amplify overconfidence. He also flagged that "that's often when people look at at a post-World War Two forward", which can drop the Great Depression and other extreme years and materially alter the statistics.
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--- Written by Lindo Xulu, StoneX TV Journalist
--- Expert: Michael Lytle, Chief Investment Officer
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