Skip navigation Scroll to top
Scroll to top

LGT Navigator: A rocky start to the new year for US stock markets

February 1, 2022

In January, US stock markets recorded their weakest monthly performance since the outbreak of the corona crisis. In Germany, prices continue to rise in the new year and inflation is higher than expected. The European economy records modest growth for the final quarter of 2021.

Difficult start to the new year.

On Wall Street, stock exchanges closed firmer at the start of the week. Thus, the first trading month in the new year ends friendly, but overall, the balance for January is gloomy. The S&P 500 lost more than -5% and recorded the weakest month since March 2020, when the spread of the coronavirus caused severe market turbulence. The Nasdaq Composite technology index fared even worse, plunging about -9% year-to-date.

Concerns about a faster-than-expected braking maneuver by the Federal Reserve have caused nervousness in the stock markets over the course of the month, putting pressure on tech stocks in particular. On Monday, however, the beleaguered stocks were among the winners, with Netflix, Spotify and Tesla each climbing more than +10%.

In Asia, the Nikkei trades slightly higher on Tuesday. The stock exchanges in China and Hong Kong are closed for a holiday.

Prices in Germany keep rising

In Germany, inflation continues to climb in the new year. The Federal Statistical Office reported that the inflation rate in January was +4.9% compared to the same month last year. Although this represents a weakening of inflation compared with December (+5.3%), analysts had expected an even sharper decline to +4.4%. The main reason for the rising prices was once again energy costs. Consumers had to pay around 20% more for heating and gasoline than in the previous year. By contrast, the base effect of the reduction in VAT, which had additionally boosted consumer prices last year, no longer applied. In addition to energy prices, supply bottlenecks continue to cause prices to rise, the statisticians said.

The cost of living has also risen significantly in Spain. Inflation increased in January by +6.1% year-on-year. Thus, prices climbed at a slightly slower pace than in December (+6.6%), but analysts had forecast a decline to +5.5%. 

Italian economy recovers

Italy's economy grew slightly in the final quarter of 2021. Gross domestic product (GDP) rose +0.6% quarter-on-quarter, the statistics agency Istat reported. This was slightly above forecasts of +0.5%. However, economic momentum has cooled significantly since the summer. Year-on-year, quarterly growth amounted to +6.4%. As a result, the economic output grew by +6.5% in 2021 as a whole, the highest figure since data collection began in 1995. The strong expansion follows the economic slump in 2020, when GDP contracted by almost 9% in the wake of the corona crisis.

By contrast, the European economy grew at a weaker-than-expected pace at the end of 2021, expanding by +0.3% compared with the third quarter, Eurostat reported. Experts had expected an average of +0.4%. Growth in the 19 euro countries was mixed. While GDP increased significantly in Spain (+2%) and Portugal (+1.6%), economic output contracted in Austria (-2.2%) and Germany (-0.7%).

Economic Indicators February 1

MEZ Country Indicator Last period
08:30 CH Retail sales (December, y/y) +5.8%
09:00 CH Seco consumer confidence (Q1) 8.0
09:30 CH Purchasing manager index (January) 62.7
10:00 EZ Purchasing manager index (January) 58.0
11:00 EZ Unemployment rate (December) 7.2%
16:00 US ISM index (January) +2.2%


Earnings Calender February 1

Country Company Period
SZ UBS Annual
US Alphabet Q4
US Exxon Mobil Q4
US General Motors Q4
US Starbucks Q4
US PayPal Q4


LGT helps you make informed investment decisions

All about global economic and market trends at a glance

Subscribe to LGT's research newsletters

You can also follow us on Facebook or LinkedIn – or visit MAG/NET and discover interesting background articles. If you have questions, a consultant from the bank will be happy to help you.

Publisher: LGT Bank (Switzerland) Ltd., Glärnischstrasse 36, CH-8027 Zurich
Editor: Alessandro Fezzi, +41 44 250 78 59, E-Mail:
Source: LGT Bank (Switzerland) Ltd.

Risk Disclosure (Disclaimer)
This publication is an advertising material / marketing communication. This publication is for your information only and is not intended as an offer, solicitation of an offer, or public advertisement to buy or sell any investment or other specific product. Its content has been prepared by our staff and is based on sources of information we consider to be reliable. However, we cannot provide any confirmation or guarantee as to its being correct, complete and up to date. The circumstances and principles to which the information contained in this publication relates may change at any time. Information that has been published should therefore not be understood as implying that no change has taken place since its publication or that it is still up to date. The information in this publication does not constitute an aid for decision-making in relation to financial, legal, tax-related or other consulting matters, nor should any investment decisions or other decisions be made on the basis of this information alone. It is recommended that advice be obtained from a qualified expert. Investors should be aware that the value of investments can fall as well as rise. Positive performance in the past is therefore no guarantee of positive performance in the future. Investments in foreign currencies are also subject to fluctuations in exchange rates. We disclaim all liability for any loss or damage of any kind, whether direct, indirect or consequential, which may be incurred through the use of this publication. This publication is not intended for persons subject to legislation that prohibits its distribution or makes its distribution contingent upon an approval. Any person coming into possession of this publication shall therefore be obliged to find out about any restrictions that may apply and to comply with them. In line with internal guidelines, persons responsible for compiling this report are free to buy hold and sell the securities referred to in this report.