Markets during January exhibited resilience amid a backdrop of geopolitical shifts. US stock achieved an average return of 3.6%, building upon a 17.4% gain in 2024, though international stock outpaced. The inauguration of US President Donald Trump introduced significant policy shifts, notably the announcement of sweeping tariffs on Canada, Mexico, and China. These actions spurred market volatility, with fluctuations observed across currency, bond, and equity markets. In the technology sector, the emergence of China's DeepSeek, an artificial intelligence startup, challenged established players. Despite these challenges, positive economic indicators, such as robust job growth and consumer spending, provided a foundation for market optimism.
In summary, January 2025 was characterized by a blend of market gains and heightened volatility, driven by geopolitical developments, technological disruptions, and shifting economic policies.
