Stock Talk - 2026 Market Outlook Preview: In Some Years, Being a Bull Rider is Harder

Episode Date: December 12, 2025

Markets have gone up since Covid, but the ride has been anything but smooth. In this video, I break down why market pullbacks are not rare events, how often investors should expect volatility, and why even strong bull markets can feel uncomfortable along the way. If you have ever wondered why markets seem to fall more often than headlines suggest, this will give you important perspective. You will also get a sneak peek into how our Oak Harvest investment team is thinking about the road ahead into early 2026. I share the key tailwinds and headwinds we are watching, why earnings matter more than headlines, and why next year may bring more opportunity and more volatility than many investors expect.   About Chris Perras, CFA®, CLU®, ChFC®, Chief Investment Officer: As CIO, Chris is the lead investment strategist and director of research at Oak Harvest Financial Group. Chris develops the firm's core market outlook, putting his decades of experience and expertise to work for our clients. He hosts Oak Harvest's podcast, "Stock Talk," available on the website with new episodes each week. He completed his undergraduate studies at Georgia Tech, and went on to obtain an MBA from the Harvard Business School. Driven by a desire to maximize his knowledge and skill set, he acquired financial planning and investment management qualifications, becoming a Chartered Life Underwriter (CLU®), a Chartered Financial Consultant (ChFC®), and a Chartered Financial Analyst (CFA®).   Stock Talk is a weekly vlog/podcast dedicated to discussing the Oak Harvest Financial Group Investment Team's perspective on what's happening in the market. Hosted by Chief Investment Officer Chris Perras, each episode brings you our views on stocks, the market, and the economy — with a little education thrown in for good measure. Listen each week and help stay connected to your money!   Do you need a retirement plan that goes beyond allocating funds to truly fit your needs? We can help you create a retirement life plan customized for your retirement vision and legacy. Call us at 877-896-0040 or fill out this form for a free visit: https://click2retire.com/lets-connect   Important disclosures: Content of Oak Harvest podcasts expresses the views of the speaker and is for informational purposes only. Oak Harvest believes that any data, articles, or information cited are reliable at the time of creation, but does not warrant any information contained herein to be correct, complete, accurate, or timely. References to third-party analysts should not be seen as an endorsement of their views or recommendations, and you should do your own research before investing. The views and opinions expressed herein may change without notice. Strategies and ideas discussed may not be right for you, and nothing in this podcast constitutes personalized investment, tax or legal advice, or an offer or solicitation to buy or sell securities. Indexes such as the S&P 500 are not available for direct investment and your investment results may differ when compared to an index. Any specific portfolio actions or strategies discussed will not apply to all client portfolios. Investing involves the risk of loss, and past performance is not indicative of future results.

Investors, since we exit the COVID lockdown, investors have been treated to a continuation of the bull market that began somewhere between 2010 and 2012, depending on your definition. As of this writing, the cash S&P 500 sits around 6850, which is up about 16.5% year-to-date. That said, it hasn't been easy to stay a bull and to stay positive and long bias the last five years. Over the last five years, an investor had to endure minus 27.5% peak to trough decline in 2022, including a near 10% inflation reading, that year, that's minus 37.5% in purchasing power declines. In addition to the 2022 earnings decline in recession, investors had recently weather a minus 21% decline in April of 2025 around the Trump tariff tantrum. Longer term investors know that if you invest long enough, you will likely endure unrealized losses and downside volatility of varied sizes each and every year if you're

invested in the S&P 500 or any other index. The reward for investing in equities is its return. The risk is enduring the downside volatility at times. Here's that great data from Charlie Beello on annual drawdowns and their frequency. Investors look at the above chart. Minus 5% declines in the S&P 500 happens nearly every year. While a minus 10% decline happens every 18 months. The dreaded bare market decline of minus 20% happens a little over once every four years, while a recessionary decline of 30% happens one out of 10 years. Investors, if you invest long enough, expect at some point during your lifetime, the S&P 500 will lose half its value.

Given its rarity, I'm going to call this one a generational decline. Investors, with this in mind, it brings me to this week's topic, our Oak Harvest's first half, 2006 market outlook, or at least, sneak peek. We've been doing these forecasts for over five years now at Oak Carvis. Our goal in this exercise is not to be precisely accurate, although many of our market forecasts have historically been both pretty accurate as well as precise, but it's to give our clients and prospects an idea of what issues as well as what opportunities the Oak Carvis investment team thinks might be coming in the year ahead. As we've discussed in the past, there are times when tactically the investing

odds favor going faster and investing more. And there are other times, like going into 2020, that it was time to curb your enthusiasm and proceed more cautiously. Investors, historically, there are certain economic and market setups that have higher odds of replaying similar past outcomes with higher frequencies. Some years, say, like 2017, the bull strolls out of the gate and your ride is over in eight seconds. An investor looks back at the end of the year and looks at their portfolio, and it looks like nothing eventful happened, and there was little to know volatility. However, more frequently, like 2025, an investor will look back and see that at least one or two bouts of major downside volatility. Most years, even in strong bowl markets,

the bull tries to buck investors off its back and onto the ground. Those investors who don't have a steady hand or retirees without an advisor or a coach, or at least a strong financial plan, can get swayed emotionally by swift increases in market volatility throughout the year. Investors, for the first half of 2006, our investment team is thinking that the tailwinds for the current bull market do extend themselves, and the pluses outweigh the negatives. However, the likelihood for higher sustained market volatility exists, and we do not expect it to be a smooth ride in the first half of next year. For now, we're going to list the headwinds and tailwinds we see for 2006.

delving into more detail in the coming weeks here in our videos, as well as in person with our clients in January at our Market Outlook summits. Investors in the Bulls camp in very strong anticipated 2026 earnings and quarterly earnings growth rates. Currently, bottoms up facts set earnings forecast have the fourth quarter of next year's earnings expected of about $82.5 up 17% year to deer from the quarter we're in right now. Remember investors over long time frames, stocks follow earnings And historically, unlike market bottoms that anticipate recoveries, the market doesn't historically peak in front of earnings, but rather coincidentally. Assuming no PE contraction in the S&P 500 in 2006, 17% growth on top of the current S&P 500

would triangulate to a much higher point in the second half of next year. Interesting. This path would also mirror the path we took along the dot-com AI investment cycle pattern post-long-term capital in October of 1998 that stocks have been. on in sync since the early April lows. A few factors that could contribute to these earnings numbers being achievable in 2006 are stronger than expected real GDP growth on the back of the elevated BBB incentive cap X spending by large tech companies. Throw in a rebound in lower end and middle end consumer spending in the middle of the year due to larger tax refunds, many spenders

will receive in the big beautiful bill, and those are positive tailwinds. The bull market kicker that our team potentially sees happening in mid-next year, a more dovish-biased new Fed chairman appointed by the president that should begin his term or her term in early May just in time if there is a seasonal weakness in the stock market. Can you say QE or maybe even yield curve control? Investors, on the negative side of the ledger in the first half of 2006, things the market is likely to worry about, first and foremost, in our book, an uptick in market inflation expectations in the early months of the year seems to be likely. As we've discussed before, inflation is seasonal in the U.S. However, concerns over catch-up tariff effects, higher New Year labor costs,

and stratospheric medical cost increases could hit just as investors begin to worry about Fed Independence under a new chairman next year. Investors, the Federal Reserve appears or fractured than we can remember with the board members split between prioritizing, waning job market strength or too higher than wanted inflation readings. Finally, like many other indicators, market volatility waxes and wanes in cycles. 2026 is the second year of a presidential cycle, the dreaded midterm election year. Investors historically, while posting positive returns, these midterm years have elevated levels of volatility and exaggerated seasonal swings and returns. A couple of these negative headwinds with the increased scrutiny of what our team is calling the A.S.

and economic credit circle, and the setup for a year of ups and downs of a bucking bull ride is higher in 2006 than many other years. The good news, our investment team has experience in these types of bucking bull markets. Remember that elevated volatility also means elevated opportunity for longer-term investors. Investors historically, the biggest incremental returns you will receive come from investing when volatility is high, not low, and the markets are down and others are acting emotionally or worse yet being forced to sell when they really should be pushing their chips into the center of the table and adding to their investments. So investors, what does all this mean to you in the new year?

Our advice to you is to keep following our investment content on Oak Harvest website and our YouTube channels. And we'll be addressing many of these points and more in the future. Investors turn into our live stream on YouTube of our 2006 Market Outlook on January 29th. And whether you desire growth or income or a combination of both in your portfolio, the entire Oak Harvest team is here for our clients doing what we can to plan for you and your family's future, regardless of what stage you're at in your career or in your retirement. All content contained with an Oak Harvest podcast expresses the views of the speaker and is

for informational purposes only. It is based on information believed to be reliable when created, but any cited data, indicators, statistics, or other sources are not guaranteed. The views and opinions expressed herein may change without notice. Strategies and ideas discussed may not be right for you, and nothing in this podcast should be considered as personalized investment, tax or legal advice, or an offer or solicitation to buy or sell securities. Indexes such as the S&P 500 are not available for direct investment, and your investment results may differ when compared to an index.

Specific portfolio actions or strategies discussed will not apply to all client portfolios. Investing involves the risk of loss and past performance is not indicative of future results.