LIVE MARKETS-U.S. stocks benefit from January feeding frenzy

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U.S. STOCKS BENEFIT FROM JANUARY FEEDING FRENZY

The U.S. stock market would not have recovered so quickly from its most recent tech rout had it not been January, when after the biggest companies report earnings, they can buy back their own stock, a note from Goldman Sachs' strategist Scott Rubner said.

"If this was not January, I don't think we would have bounced back this fast," said Rubner.

Monday's selloff came after Chinese startup DeepSeek launched AI models it says are on a par or better than industry-leading models in the United States at a fraction of the cost.

U.S. stocks recovered on Thursday, as gains in names such as Tesla TSLA.O, Meta Platforms META.O and IBM IBM.N overshadowed a drop in Microsoft MSFT.O, while comments from President Donald Trump about tariffs curbed the advance late in the session.

Trading volumes generally jump in January after companies report earnings and their stock repurchase window re-opens, said data from Rubner's note, which went to clients late on Thursday.

"The magic is running out but carries over into early February," said the note.

Roughly an average of $4.6 billion worth of U.S. stocks are traded each day, but this amount balloons to around $7 billion during the corporate repurchase window, when big public companies are allowed to buy back their own stock.

January is also when retirement funds look to buy stock with the first month of the year usually the single largest for equity mutual funds and ETF inflows, said Goldman data.

Plus, last week when tech stocks plummeted retail traders bought the dip, said Rubner's note.

"There is a lot of capital sloshing around," he added.

(Nell Mackenzie)

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