Shesa'a JANUARY 2026 Investment Blog

Welcome to my New Year 2026 Blog

Wishing a Happy and wonderful New Year 2026 to all my log readers. Let’s hope the market continue to grow in 2026!

A recap of 2025

The year 2025 started with a small downturn but subsequently market started picking up till February 20. After that, tariff fears emerged and on April 2, 2025, Donald Trump declared his "Liberation Day" to and announced new tariffs on imports aimed at reducing trade deficits and reviving U.S. industry. That scared the stock market like hell and stocks started dropping like rocks until April 8. Subsequently, Trump declared some relaxation period for the countries to negotiate on tariff. This enlightened the market and started picking up till October 8 and we saw one of the best September (Nasdaq up 5.61%), that defied the typical “September Effect”. Historically, November happens to be one of the best month but Wall Street had some plan. The circular financing, debt financing and AI stock’s valuation issues emerged and AI stocks got hammered. Again, the market picked up later part of November but the fear about the AI stocks continued, money started moving from tech stocks to DOW stocks. DOW and S&P 500 hit multiple new all-time highs. S&P 500 hit new all-time high 46 times in 2025. Usually, November and December happened to be best for technology stock but this year the hammering of AI stocks continued. We also did not see any Santa Clause rally this year which usually happens in the last 5 trading days of the year! Furthermore, we saw the Nasdaq close in red on 31st December after 7 years, since 2018! I can attribute to “cooling AI enthusiasm”. So, can we hope to see some rally in early January. That’s very much on the card but honestly it’s impossible to predict the stock market!!

Federal Reserve

The federal reserve cut another 0.25% interest rate on December 10 bringing the rate down to 3.5 - 3.75%.  We saw three rate cuts in 2025. Probably this was the last rate cut we  might have seen by J Powell before his term ends on May 15, 2026 unless there is any significant economic changes. 

The stock markets have gone up for straight for three years in a row 2023, 2024 and 2025. So, the key question is what will happen in 2026? One thing is it would be a tricky 2026. I will elaborate my views on this. But before that let’s see the stock market index.

Indexes	Close TUE 12/30/24	Close FRI 12/31/25	Change in 2025	% Change in 2025
DOW	42,544.22	48,063.99	5,519.77	12.97
S&P 500	5,881.63	6,845.5	963.87	16.39
NASDAQ	19310.79	23,241.99	3,931.20	20.36
Russel 2000	2,230.16	2,481.91	251.75	11.29
SOX (Semi)	4,979.93	7,083.13	2,103.20	42.23

What can we expect for the stock market in 2026?

The analysts are anticipating for another 10-15% rally for S&P 500 in 2026. However, it is expected to be a very volatile year. The key reason is, “mid term election year”, where the stock market has not done well historically. The midterm election years have been the worst of 4 years presidential cycle. Usually, S&P 500 retuned about of 3-4% since 1928 vs. 10-10.5% return generally for S&P 500. If we see last 60 years starting 1966 there were nine bear markets or about 65% of time there were bear market in the midterm election years. 

1966, 1970, 1974, 1978, 1982, 1990, 1998, 2002, 2022. 

It means the index was down more than 20% in these years.  But it does not mean every midterm year was negative. The indexes were up in 1986: +18.6%, 2006: +15.8%, 2014: +13.7%. So, we can’t predict with certainty what is going to bring in 2026. But one thing can be told with more certainty is that, there would be more volatility. My thinking is that, after Q1 results - possibly around February till midterm election in November 3, the market may get rocky. Having said that, post-midterm (next 12 months) the market becomes  much stronger at an average return of 15%+ as the uncertainty goes away and investors feel relief and rally picks up. So, why does market become volatile and rocky during midterm election years? The primary reason is due to “policy uncertainty” whether the ruling party will keep its senate and house seats and what would be the policy changes going forward!

Positives for 2026

• Strong corporate earnings growth: Expected 10-14%, mostly due to continued AI investment and productivity gains. Many Wall Street firms project GDP growth of 1.4% to 2.8% which is similar to 2025. However, in my view, it may get better if there is higher productivity gains and a stable job market. If job market is good, people tend to spend; if not, people become conservative in spending. And as we know about 70% of GDP depends on consumer spending. 
• Potential Fed rate cuts: As said earlier, J Powell may bot cut rates before he departs on May 15. However, Trump is interviewing many potential candidate for Federal Reserve chair who may be pro-rate cutting. So, I believe the next Fed chair would cut rates at least 2-3 times next year. If so, that would help consumers, home market, and overall economy to grow. If the rate cut optimism continues then it should help small cap stocks, tech stock, real estate, consumer discretionary, housing etc. Because lower the rates higher the liquidity and consumer spending. In addition, starting December 1, 2025; Federal Reserve has stopped Quantitative Tightening (QT) which should be favorable for the stock market.
• Tax policies boosting growth: Trump has instituted many Tax changes viz. increase standard deductions, deductions for tips and overtime pay, increased SALT deductions, increased child tax credit, new education savings account called “Trump Accounts” for newly born since 2025, new senior deductions for people above 65. This should bring more money for investing and should help stock market.
• Deregulation: Trump administration is going to do more deregulations in this midterm election year. This may help financials, but remember many financial stocks have gone up more than even technology stocks. It may help energy but better to stay away. It may help small business, technology AI, Data center and energy stocks by faster permit.

• Major IPOs may help boost stock market: Watch the year 2026 where we may see huge IPOs as follows: 
• SpaceX (mid/late 2026): Elon Musk’s SpaceEx is expected to be the biggest IPO in the stock market history. As it stands today, the IPO is expected to take place in 2026. The valuation is anticipated to be appox $1.2 -1.5T  to raise $30B+. Obviously, I will look forward to this. There are some expectations that Tesla (TSLA) shareholders may get some chance to invest in this IPO. if so, that would be a great news for Tesla shareholders. This may also help Tesla shares.
• Anthropic AI company: $300B+ valuation
• Databricks (AI/data, $100B+ valuation)
• OpenAI (late 2026 possible, about $800B- $1T target). There is hype about it but now Anthropic and Gemini 3 are taking traction and growth. So, I will be little careful on this. 
• Stripe (payment system): $100B+ valuation

IPO - Stock market impact: boosts liquidity, attracts investment in AI/tech; fuels rallies in growth sectors; increases trading volume. It also adds supply pressure, so some stocks may go down as investors tend to sell and invest in new IPO with high potential. But it can be noted that, IPOs are dependent on market situation. If market is not good, many companies differ in their plan and may delay going IPO.

• Mergers and Acquisitions: One of the key aspect that we may see lots of mergers and acquisitions in 2026 driven by higher private equity capital, supportive regulatory environments, falling interest rates, and strategic necessity in sectors like AI, cybersecurity, tech infrastructure, and healthcare. Some projects 3-7% growth, Morgan Stanley say 20% growth. Nothing can be told with certainty but I think it should be much more than 2025.
• Potential for reduced Inflation - low oil prices, less energy and electricity cost

Negatives for 2026

• Mid-term Election Year: I believe this is the biggest risk for stock market as it has historically not done well in the past as I have already written about it above.
• Job Market and Consumer spending: Jobs are the most important factor in consumer spending. If the job market deteriorate because of AI productivity improvements or higher rates or any other reason then consumer may pullback on spending. That may impact overall market sentiment. I hope we do not get into recession (less likely). But in my view, this could be the biggest risk for 2026.
• Sticky Inflation: In case inflation does not come down and start ticking up then rate cut hope will fade and market may react.
• AI hype bubble concerns: We saw what happens to the high flying AI stocks in November and first half of December. There were concerns about debt financing, higher valuations, spiral financing etc. Stock market sometime is driven more by sentiment rather than real fundamentals, so such concern may come from time to time. These scare the retail investors and the big sharks in the stock market eat the small fishes. I hope you know what I mean..The street will keep beating the drum as long as they can…
• Policy uncertainty (tariffs, immigration, deficits): This may impact but not as much as it was in 2025.

Let me sum up

2026 is the midterm election year.  Historically, the stock market return 3-4% and have gone to recession 9 times in last 60 years. We may also see lots of volatility due to policies, Federal reserve, job market situation, consumer spending, AI return on investment, valuations, financing  etc. We may see phases on ups and downs. As I said, it will be a very tricky year. Hence, the best way will be to keep a closer watch to the market situation and certainly be extremely vigilant. Nothing can be told with certainty, but it’s better to be careful from March - October. With that said, post midterm election, the stock market takes off, hence that would be a great time to be invested. I do not have a very high hope in 2026, but I still think it’s reasonable to think that Nasdaq may go up 10-12% due to the positives mentioned earlier. If we get more that’s bonus.

My Strategy for 2026

Let me first tell one thing, “strategy is not constant” and may keep changing based on market situation, sectors/stock doing well, where money is moving and may other unknown situation. As I said, 2026 is going to be very tricky. I am expecting the market to ultimately go up the year as a whole but there may be many situations this year where things may get very dicey. 

• The first thing that I would try to remember is not go very aggressive, very selective on buying stocks and minimize on call options. Because 2026 may have lots up bumps now and then. Hence, being very aggressive may be detrimental. Having said that, I am growth investor.
• Since it’s expected to be a volatile year, it would be of paramount importance to take profits regularly and having some CASH on the sidelines will help leveraging the pullbacks.
• Have some mitigation strategy: taking constant profits, hedging the portfolio. This has always been my strategy. But remember, as I say when tsunami comes the small dams can’t protect but at least it can obstruct some water flow. So, the whole portfolio can’t be protected but at least there is some protection. 
• This year may be a stock pickers market to choose the right stock and diversification should be valuable. 
• Have patience and thoughtful execution, not to be thrilled or too depressed when situation do not go our way. Controlling the emotions (Greed and Fear) is the KEY
• In an uncertain environment I would not overload but keep an eye on good stocks which have/had strong earnings can be accumulated in small quantities slowly and steadily to do dollar cost average. But we should know when to stop accumulating.
• Watch the market trend and invest accordingly. Put money on what’s working, not what’s losing.  Remember “hope” is not a strategy!! Though most of keep making this mistake. 
• Some diversification into healthcare, real estate, financials , consumer discretionary  would be helpful if further interest rate cuts hope arise.

A Recap of my personal investment in 2025

The year started alright but worsened during April because of Tariff news. However, we saw one of the best September and October where portfolio zoomed. However, starting November the AI stocks started deteriorating and got clobbered due to apprehension about debt, circular financing, bear reports etc. The money started moving to DOW stocks. There were lots of AI stocks did quite well: TSLA, NVDA, AVGO, APLD, CRWV, NBIS, GOOG, HOOD, IONQ, OPEN, TEM, QS etc. But in the last couple of months most of these stocks went south and that was detrimental to my portfolio as options some options got decimated. Fortunately, I had taken some profits and hedged the portfolio but it was not enough to beat Nasdaq. This year, I will be more cautious, less aggressive and hope it turns out better. We can hope for the best but stock market is not in our control. These days, the stock falls like rock in few days and becomes very volatile and violent at times.  Wall Street can do anything! This reminds me of “how much we make is one thing, but how much we keep is the key. “Mr. Market” always teach us some lessons and it’s better to learn from it and try to do better..

My current list of Stock picks for 2026

Before I start writing, please note that nothing is written on the stone. The situation may change, hence the strategy may have to change. These stocks outlined are just the prospects at this time.  This is not a buy list. So, one must do due diligence before buying any stock. 

Nvidia (NVDA): Still the AI king and one of the cheapest in the market considering its current revenue growth, profit growth and future potential. We are still in early/mid phase of AI growth. Nvidia remains on elf my top pick. With that said, no stock go up on a straight-line. So, there will be ups and down and that’s when the decision making becomes critical to decide when to take position, when to accumulate and when to trim and exit from a stock. There is no written and hard first rule. It all depends on our investment strategy.

Tesla (TSLA): I know many folks are apprehensive on this stock. But I think this is one of the best long term investment if we have a time horizon for next 2-3 years. I do not buy Tesla at one time. This is stock should be owned, trimmed and have a core position for long term. In next 2-3 years, I expect this stock to double or triple. But this is one stock when someone buy at the dip and keep accumulating slowly and wait patiently should do well more than 90% of the time. If we think Tesla as a EV company then we should not invest. There are many catalysts for this company in next 1-2 years; robotaxi expansion, humanoid robots (cybercrab),  Tesla Semi Truck, huge growth on power storage (megapack battery), cheaper version of EVs etc. Furthermore, SPaceX is expected to go public in 2026 which is seen as the biggest IPO in the history of U.S stock market. It’s probable that Tesla shareholders may get preference to invest in the IPO. If so, that would be a very big deal. If one has to be an investor in Tesla then one must take profits as needed, also have some hedging because the company tend to pull back 15-20-25% on many occasions and that gives an opportunity to add more.

META: The stock got slammed after its Q3 earnings but I believe this sock is highly likely to turnaround this year. The AI-enhanced advertising on Facebook, Instagram, and efficiency gains. This stock should bounce back.

GOOG: AI integration in search, cloud, and ads for robust earnings. Gemini is getting more attraction and may take the monopoly of ChatGPT. Off late, it has become slightly expensive but still I see good potential.

Broadcom (AVGO): Strong AI semiconductor demand and custom chip growth. It still has huge potential. The growth will continue thought it’s still little expensive comparing to NVDA.

Amazon (AMZN): Never to forget this gorilla. The AWS cloud and AI services driving sustained growth. Last quarter was a great quarter and if the interest rate comes down it should benefit.

Palantir (PLTR): Accelerating commercial AI platform adoption. It does not show any slowdown. Despite its high valuation, it has great potential/ 

Applied Digital (APLD), CoreView (CRWV), Nebius (NBIS): I still like this stock despite the apprehension in Wall Street about Data Center/AI Infrastructure. I think too much negativism. Once investors confidence is back these stocks may run. But one must hedge or take profits as needed otherwise we may just sit and repent.

Robonhood (HOOD): The stock went up too much in 2025 and has become little expensive. So, I do not see the gain like last year but I see good revenue and profit growth driven by prediction markets, crypto, international expansion. Deregulations and interest rate cut should also help the stock.

Tempus AI (TEM): Fantastic revenue growth in 2025. I am bullish on this AI for 2026. The company has projected revenue growth of 25%+ for next three years. I also think it may be a acquisition candidate. 

Carvana (CVNA): This is another stock which had remarkable turnaround from about $3 about 3 years ago to $43x.. With interest rate coming down and its strength in online used car market with AI adoption is paying dividend. This is is another stock buying on dips and holding patiently has very often has done remarkably well..

IONQ: Leader in Quantum computing. If and when there is a turnaround in technology stock, watch for this. It has tremendous long term potential but very volatile.

Hims & Hers (HIMS): This stock was hammered but I am still positive and feel for turnaround in 2026. I may continue 40-50% growth into profitability.

MongoDB (MDB): It had explosive earnings and any pullback may be a good opportunity.

DoorDash (DASH): The stock was beaten down after Q3 earnings but I see this to comeback.

Rocket Company (RKT): If interest rate comes down and the housing market picks up then this could be one of the best. If not, it may not do much.

Some speculative stocks that I will keep an eye:

• SOXL and TQQQ: Depending on market bounce these may be best. If market goes down, one must be very careful.
• D-Wave Quantum Inc (QBTS)
• Recursion Pharmaceutical (RXRX)
• QuantumScape (QS)
• OpenDoor (OPEN)
• Enovix (ENVX)

Please note that the above stocks are not recommendation to buy/sell any stock. These are just my personal view. It does not necessarily mean that these stocks will do well. So, one must do due diligence before taking any position.  

Stock Market TOP sectors for 2025 (as of 1/1/26)

Sector	Performance in 2026 in %
Communication Services	32.41
Information Technology (TOP)	23.31
Industrials	17.70
Financials	13.32
Utilities	12.69
Real Estate (Worst and only Sector in Negative)	-0.35

You can click below link to view complete sectorial performances:

Source: https://www.barchart.com/stocks/sectors/rankings?timeFrame=Ytd

Now let me discuss this month’s hedging pick for my Blog Portfolio.

Advanced Micro Devices (AMD) 

Advanced Micro Devices is a semiconductor company. It operates in three segments: Data Center, Client and Gaming, and Embedded systems. The company offers artificial intelligence (AI) accelerators, x86 microprocessors, and graphics processing units (GPUs), chipsets, and data center and professional GPUs; and embedded processors and semi-custom system-on-chip (SoC) products, microprocessor and SoC development services and technology, data processing units, field programmable gate arrays (FPGA), smart network interface cards, and adaptive SoC products.    

Why I like AMD

After Nvidia, AMD is one of the dominating AI infrastructure, data center company and have partnership with Microsoft, OpenAI. It specializes in CPUs, GPUs, and AI accelerators. Its product may not be better than NVDA but comparable and costs less. This makes a better choice for alternative to Nvidia GPUs. Undoubtedly, Nvidia is the AI king but it has its demand and supply limitations. Hence, many companies are looking for the alternatives to Nvidia chip. This is where AMD scores. AI is not in bubble and it’s still in its early to mid stage, hence numerous opportunities lies ahead. If we see the chip sector then NVDA, AVGO and AMD are the three leading players with huge potential. The year 2026 may become rocky at times, but in my view AMD still has great opportunity.

• Major catalysts: MI350 series ramping now; MI400 series expected to launch in mid-2026 for superior AI performance and efficiency.
• Partnerships: Deals with OpenAI (multi-GW deployment), Oracle, Meta

Financials

• Revenue: Strong AI growth: Data center revenue grew to a record in last quarter i.e. Q3 2025: $9.25B vs. $8.7B expected, +36% YoY, data center had $4.3B in revenue.
• Q3 EPS $1.20 vs. 1.09
• 2025 full-year estimates: Revenue $33B – $40B; EPS $3.90.
• 2026 Guidance: Revenue above 35%, data center targeting $100B annual long-term; EPS projections $6+.

Strategy

Currently the stock is trading at $214.16 as of last Friday. The 52-week high for this stock is $267.08, down about -20% from its high. The stock has gone up 75% since the beginning 2025. year. The stock has a forward P/E ratio of 34.7 which is not cheap. But Nvidia has pent up demand which may not be fulfilled and the beneficiary should be AMD. Hence, I have taken some position in this stock as I feel it’s worth holding in 2026. As most of my blog readers know, I am  a growth investor and usually I never buy any stock at once. I always buy in small quantities in a phased manner. When the stock goes up, it’s extremely important for me to take some chips out of the table and book some profits. That’s always part of my strategy. Also, AMD is a growth and volatile stock, hence some hedging is important to mitigate/protect from any significant downside. But I may slowly keep accumulating if the stock pulls back further. But as I said, it’s better to be more vigilant this year.

Risks

As I said above, obviously it’s not a cheap stock. If the market goes down or semiconductor sectors goes down AMD may be hit hard. This stock is advisable only for the growth investors who can absorb volatility. Otherwise, better to stay away. There is always a risk with any stock, and more so for the growth stock.

My final thoughts

AMD is a growth company and a beneficiary of the AI growth. It’s also little expensive stock based on the fundamentals. Having said that, I still think it’s an opportunity. But I will not be over invested until AI negativism subside. If I see any red flag on any of my holding, then I do not hesitate to pull the trigger. At this time, I feel AMD seems to be a good stock because of AI adoption, hence I am invested.

Shesa’s Blog Portfolio (As of JAN 1, 2026)

Equity	Suggested Price	Current Price	Suggested Date	% Change	My View  (see disclaimer)
STOCK (All prices are in USD)
AAPL	12.9	271.86	1/25/13	2007%	Buy on Dip
META	47	660.09	11/13/13	1304%	Accumulate
MA	77.18	570.88	12/12/13	640%	HOLD
AMZN	15.58	230.82	4/12/14	1382%	Accumulate
SHOP	13.48	160.97	11/25/18	1094%	HOLD
SPG	54.59	185.11	5/25/20	239%	HOLD
NVDA	23.9	186.5	2/13/22	680%	Accumulate
TSLA	290.25	449.72	5/1/22	55%	Accumulate
RKT	14.24	19.36	7/6/25	36%	Accumulate
SOXL	15.66	42.03	4/6/23	168%	Accumulate
GOOG	123.25	313.8	5/21/23	155%	Accumulate
PLTR	20.49	177.75	11/19/23	767%	HOLD
PANW	142.06	212.29	3/31/24	49%	SOLD
ENVX	10.48	7.31	4/28/24	-30%	HOLD
Z	51.92	68.22	8/11/24	31%	Buy on Dip
LRCX	76.16	171.18	11/11/24	125%	Buy on Dip
RXRX	5.32	4.09	1/2/25	-23%	HOLD
IONQ	37.46	44.87	2/18/25	20%	Accumulate
AVGO	203.64	346.1	4/5/25	70%	Buy on Dip
APLD	11.18	24.52	6/15/25	119%	Accumulate
HOOD	94.4	113.1	7/6/25	20%	Accumulate
CRWV	104.14	71.61	8/3/25	-31%	Accumulate
NBIS	65.47	83.71	9/7/25	28%	Accumulate
HIMS	53.95	32.47	10/12/25	-40%	HOLD
TEM	71.56	59.05	11/9/25	-17%	Accumulate
AMD	214.16	214.16	1/1/26	0%	NEW ADDITION
MUTUAL FUND
PRMTX	59.45	131.56	12/20/14	121%	HOLD
FSRPX	9.05	17.92	1/15/16	98%	HOLD

Equity Sold since my Last Blog

Palo Alto Networks (PANW)

Here is my YouTube channel link:  https://www.youtube.com/channel/UCt7oLVUMG3NkJUzAVUzl4Tg

Disclaimer: This blog is meant to provide my opinion only. The information provided is to the best of my knowledge but may not be accurate. I do NOT provide any professional recommendation to buy/sell any stock, ETF, mutual fund, or any other security(s). As an investor, it’s your hard-earned money and you decide what is best for you. The above are merely my own opinions on what I do. Please contact a professional money manager to buy/sell any security. I do not charge any fees or commission by writing the blog except anything from Google AdSense. I have position(s) on whatever security I put on my blog portfolio and avoid including any security that I do not own or follow. Anyone buying or selling the equities mentioned here must do at their own risk.

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