The major indexes finished last week little changed and head toward the teeth of fourth quarter earnings season near record highs.

A rotation in markets saw the small-cap Russell 2000 (^RUT) close at a record high on each of the week’s final three trading days, while the Dow Jones Industrial Average (^DJI) — which has lower exposure to Big Tech and the dominant AI theme driving markets — paced gains among the major averages.

The S&P 500 (^GSPC) was virtually unchanged for the week, while the Nasdaq Composite (^IXIC) fell about 0.4%.

Oil prices, which continue to bear close watching amid a rush of geopolitical headlines related to Venezuela, Iran, and Greenland, were also little changed for the week, rising a bit less than 0.5%.

Read more: Is the stock market open on MLK Day? What to know about the holiday trading schedule in 2026.

In the week ahead, investors will have three key themes to track while fourth quarter earnings season gets into full swing and the Federal Reserve’s next meeting approaches.

The first is President Trump’s speech at the World Economic Forum in Davos, Switzerland, which is expected to take place on Wednesday morning ET.

The second will be any updates on Trump’s thinking around who he may nominate as the next Federal Reserve Chair. As of Friday afternoon, Polymarket prediction markets put Kevin Warsh, a former top Fed official, as the favorite to receive the nomination, with his odds standing at 60%. This came after Trump told Kevin Hassett, director of the president’s National Economic Council and another leading candidate to receive the nomination, that he preferred him in his current role at an event on Friday.

The aforementioned geopolitical entanglements and a variety of domestically focused policy proposals from the administration this year — ranging from credit card fee caps, various plans to help prospective homebuyers, and changes in tariff policies — all serve as potential topics of discussion for one of Trump’s biggest international appearances of the year.

The third key theme for investors will be the ramp-up in fourth quarter earnings, most notably results from Netflix (NFLX) and Intel (INTC).

Netflix is currently embroiled in one of the most gripping media dramas in recent memory as it tries to acquire Warner Bros. Discovery and ward off competing bids for the famed studio from Paramount Skydance (PSKY).

Netflix’s bid to acquire Warner Bros. Discovery’s streaming and studio assets still remains the company’s preferred deal. Though Bloomberg last week reported that the streaming giant was preparing to sweeten its takeout bid to make it an all-cash offer, matching some of the terms of Paramount Skydance’s proposal to acquire Warner Bros. Discovery. Netflix’s proposal does not include the company taking on Warner Bros. Discovery’s cable and news businesses, which Paramount’s bid does.

Intel’s results will offer investors a read on the state of the artificial intelligence trade — as just about every cog within the tech-industrial complex does now — and comes with the company’s stock up about 100% since the US government announced a roughly 10% stake in the chipmaker in August 2025.

For the better part of the last decade, each year has begun with Wall Street strategists trying to identify and then dissect a new rotation within markets.

Two weeks into 2026, and the winners and losers emerging may be familiar to readers who have followed the ebbs and flows of this investing meme over the years, with small-cap stocks benefiting while pockets of the tech trade cool.

The small-cap Russell 2000 is trading at a record high. The equal-weighted S&P 500 (^SPXEW), which weights each member of the index equally rather than by market cap, closed at a record high on Jan. 13.

And this while software stocks have been some of the year’s biggest losers so far. Names like Intuit (INTU), ServiceNow (NOW), Adobe (ADBE), AppLovin (APP), and Salesforce (CRM) are all down more than 12% so far this year.

Read more: What’s ahead for stocks and gold in 2026? What experts are watching.

As Hardika Singh, a strategist at Fundstrat, wrote in a client note on Friday, the Russell 2000’s strength is a positive sign for investors’ outlook on the US economy, as these companies’ share of revenue coming from domestic customers is typically higher than the members of the S&P 500. (S&P 500 companies make about 40% of their sales internationally.)

Singh also noted that the Russell’s resurgence is not, strictly speaking, a 2026 phenomenon — over the past six months, the index is up about 20% against a roughly 10% gain for the S&P 500.

What is notable, however, is that while the Russell Renaissance may well suggest a more positive outlook from investors on the US economy, the theme driving these gains is one that got all of us here in the first place: AI.

“Shares of everything from electricity providers to defense companies to mining companies are participating this time, a sign that the rally has legs,” Singh wrote.

“Fuel-cell maker Bloom Energy’s stock has added 60% this year, Kratos Defense & Security Solution has rallied 64%, and Hecla Mining has advanced 31%. Responsible for their gains are the same themes that have carried their large-cap counterpart to hit fresh all-time highs over the past year, such as the urgent need to power AI data centers and a face-ripper rally in gold prices benefiting mining companies’ margins.”

Moreover, the S&P 500 itself tells the same story.

Leading the way in the year’s early going for the benchmark index are companies like Sandisk (SNDK) (which was also the best-performing S&P 500 stock in 2025), Lam Research (LRCX), Western Digital (WDC), and Intel (INTC). All of these names are plays on the AI trade, with a hardware slant.

Over the last three years, the AI trade has taken many forms. But many investors and commentators — and here we might have a hand up too — haven’t moved off the “Magnificent Seven” names as the big winners of this theme. These have been, for the most part, great stocks since the spring of ’23. And still the Magnificent Seven names remain the market’s largest.

What steels the resolve of market bulls as the AI trade approaches its fourth year, however, is exactly the kind of action that has defined the market so far in 2026: a forceful move into a new derivative of the same theme.

Economic data: Markets closed for Martin Luther King, Jr. Day.

Earnings calendar: Markets closed for Martin Luther King, Jr. Day.

Economic data: ADP weekly employment change, week ended Jan. 3 (+11,750 previously); Philadelphia Fed non-manufacturing activity, January (-16.8 previously)

Earnings calendar: Netflix (NFLX), United Airlines (UAL), Interactive Brokers (IBKR), 3M Company (MMM), US Bancorp (USB), Fastenal (FAST), D.R. Horton (DHI), Fifth Third Bancorp (FITB), KeyCorp (KEY), Wintrust Financial Corporation (WTFC)

Economic data: MBA mortgage applications, week ended Jan. 16 (+28.5% previously); Construction spending, month-on-month, October (+0.1% expected); Pending home sales, month-on-month, December (+3.3% previously)

Earnings calendar: Johnson & Johnson (JNJ), Charles Schwab (SCHW), Prologis (PLD), TE Connectivity (TEL), Truist Financial (TFC), Kinder Morgan (KMI), Travelers (TRV), Halliburton (HAL), Teledyne Technologies (TDY), Citizens Financial Group (CFG), Ally Financial (ALLY), Pinnacle Financial Partners (PNFP), Dr. Reddy’s Laboratories (RDY)

Economic data: GDP annualized, quarter-on-quarter, third quarter (+4.3% expected, +4.3% previously); Personal consumption, third quarter (+3.5% previously); Initial jobless claims, week ended Jan. 17 (198,000 previously); Continuing claims, week ended Jan. 10 (1.88 million previously); Personal income, November (0.4% expected); Personal spending, November (0.5% expected); Personal consumption expenditures price index, month-on-month, November; PCE price index, year-on-year, November; Core PCE price index, month-on-month, November (+0.2% expected); Core PCE price index, year-on-year, November (+2.8% expected)

Earnings calendar: GE Aerospace (GE), Procter & Gamble (PG), Intel (INTC), Abbott Laboratories (ABT), Intuitive Surgical (ISRG), Capital One (COF), Freeport-McMoRan (FCX), CSX Corporation (CSX), Huntington Bancshares (HBAN), Northern Trust (NTRS), McCormick & Company (MKC), Alcoa Corporation (AA), East West Bancorp (EWBC), Mobileye Global (MBLY)

Economic data: S&P Global US manufacturing PMI, January, preliminary reading (51.8 previously); S&P Global US services PMI, January, preliminary reading (52.5 previously); University of Michigan sentiment, January, final reading (54 expected, 54 previously)

Earnings calendar: SLB N.V. (SLB), First Citizens BancShares (FCNCA), Booz Allen Hamilton (BAH), Comerica Incorporated (CMA), Webster Financial Corporation (WBS), Moog Inc. (MOG-A, MOG-B), United Bankshares (UBSI)

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