January 2023 Asset Class And Stock/Sector Performance

Galeanu Mihai

It was a January to recollect for investors (who went through one in all the worst years in recent history in 2022). Below is a have a look at the recent performance of varied asset classes using our ETF matrix. Performance in January (YTD 2023), over the past six months, and over the past yr is shown for every ETF (or exchange-traded product).

Looking specifically at January, the Nasdaq 100 (QQQ) was the best-performing US index ETF with a gain of 10.6%. The small-cap Russell 2,000 (IWM) wasn’t far behind with a gain of 9.8%. The Dow 30 (DIA) – the index that held up the very best in 2022 – was up the least in January with a gain of two.95%.

On the sector level, Consumer Discretionary (XLY) was up probably the most with a gain of 15.1%, followed closely by Communication Services (XLC) at 14.8%. While these two sectors were up double-digit percentage points, three sectors actually fell in January: Consumer Staples (XLP), Health Care (XLV), and Utilities (XLU).

Outside of the US, the bulls were running with various country ETFs up 10%+, including Australia (EWA), China (ASHR), France (EWQ), Germany (EWG), Italy (EWI), Mexico (EWW), and Spain (EWP). India (PIN) was the one country in our matrix that was down with a decline of just 5 basis points.

Commodity ETFs/ETNs were mostly flat, with one exception – natural gas. As shown, UNG was down 33.9% in January, and it’s now down 67.4% over the past six months.

Finally, Treasury ETFs continued to bounce back after a horrific 2022, with the longer the duration, the higher the performance. The 20+ yr Treasury ETF (TLT) was up probably the most with an enormous monthly gain of greater than 7%.

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Below is a have a look at the typical performance of stocks within the large-cap Russell 1,000 by sector during this past January. We also show the typical distance from 52-week high and the typical total return in 2022. As you possibly can see, the areas that got hit the toughest in 2022 are those that bounced back probably the most in January. The typical stock within the Communication Services sector gained 16% in January, but these stocks are still 32% below their 52-week highs after falling 32.6% in 2022. Energy and Utilities stocks averaged minimal gains in January, but they’re also the one two sectors that averaged gains in 2022.

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Finally, below is a listing of the 35 best-performing individual stocks within the Russell 1,000 in January. Topping the list is Carvana (CVNA) – which continues to be within the Russell 1,000 for now – with a gain of 114.6% in the course of the month. Even after greater than doubling in January, CVNA stays 94% below its 52-week high.

Apart from National Instruments (NATI), this list of massive winners in January is a who’s who of stocks that got crushed in 2022. Not one stock was up last yr, and so they were down a mean of 61.6% in 2022! After averaging a gain of 49.6% this month, they’re still near 50% below their 52-week highs. The 2 biggest stocks on the list are Tesla (TSLA) and NVIDIA (NVDA). Tesla ended up gaining 40.6% in January after falling 65% in 2022, while NVIDIA gained 33.7% after getting cut in half in 2022. Another recognizable names include Lucid (LCID), Peloton (PTON), Warner Bros Discovery (WBD), Lyft (LYFT), Spotify (SPOT), Roku (ROKU), Zillow (ZG), Paramount (PARA), and Carnival Corp. (CCL).

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On the flip side, below are the 35 worst-performing stocks within the Russell 1,000 in January. Whereas the best-performing stocks this month were those that got hit hardest last yr, the worst-performing stocks this month were mostly names that really posted gains in 2022. On average, these 35 stocks fell 8.5% this month, but they were up 11.4% last yr and are only 24% from 52-week highs. The three worst-performing stocks in January were Northrop Grumman (NOC), Enphase Energy (ENPH), and Texas Pacific (TPL). All three were up huge last yr, with NOC up 43%, ENPH up 44.8%, and TPL up 91.2%.