Stocks have had a lousy start, but Wall Street expects a good year ahead.

It once was a rule of thumb on Wall Street that January set the tone for the year. As it stands, this month has been the worst since March 2020, when the pandemic rattled markets and stocks suffered stomach-churning drops.

Through last week, it was also the fourth-worst January for stocks since at least 1928, according to S&P Dow Jones Indices. The market is down just under 7 percent this month.

The S&P 500 was up 0.5 percent in early trading and the Nasdaq composite rose 1.4 percent on Monday, the final day of a turbulent month for trading. After wild swings last week, stocks recovered some of their losses in a late rally on Friday, although the direction lately has mostly been down.

Investors have been fretting about inflation, specifically the Federal Reserve’s efforts to fight it by raising interest rates. If the Fed doesn’t do enough, higher inflation may erode the wage gains workers are finally earning. Too much, and the economy could stall just as workers are returning after the pandemic ebb.

Last week, Jerome H. Powell, the Fed chair, confirmed a plan to raise interest rates “soon,” probably starting in March. But he gave few details on how high interest rates would need to go, or what the Fed might do about the trillions in bonds it has bought to lift the economy during the past two years.

“The Fed really changed its tone in the last month,” said Kathy Bostjancic, the chief U.S. financial economist at Oxford Economics. “It had been communicating that inflation had been transitory, and now they’re worried it’s not and that it will be more persistent.”

This has left investors feeling uneasy about the markets, which have started the year on a sour note. That said, the link between January trading and the rest of the year has been weaker recently. January market drops are fairly common, including in the previous two years, which ended up recording large annual gains.

Many Wall Street strategists are predicting that the market will end 2022 higher. David Kostin, the chief U.S. stock market strategist at Goldman Sachs, for instance, predicts that the market will end the year up 15 percent from where it closed on Friday. UBS’s top stock strategist, Mark Haefele, said in a note to clients on Thursday that he was also sticking to his year-end target: up 15 percent from the close on Friday. “We expect the equity rally to resume,” Mr. Haefele wrote in his note.

The market seems volatile, but its recent swings have been only slightly bigger than usual. During the past 60 years, the average high-low spread — the difference between the highest point of the day and the lowest point of the day as measured by the market-tracking S&P 500 index — has been 1.4 percent, said Howard Silverblatt, a senior analyst at S&P Dow Jones Indices. So far this year, that measure is 1.8 percent, about the same as it was in 2020, but far less than the 3 percent it averaged in 2008, during the height of the financial crisis.

The average investor has yet to be scared off. Bank of America wrote in a research note last week that its retail clients, as a group, put more money into the stock market than they pulled out. In the first three weeks of the year, individuals with accounts at Bank of America have bought $2.3 billion more in stocks than they have sold.

In the same time, though, hedge funds that use Bank of America to trade have sold nearly $3 billion in stock and bond funds than they have bought. “Retail clients remained the biggest buyers (as is typically true in January),” Jill Carey Hall, a Bank of America strategist, wrote in the note. “Clients bought the dip.”

One thing buoying optimism is that corporate profits have kept climbing. Analysts believe that fourth-quarter profits rose 24 percent for companies in the S&P 500 compared with the same period the year before, according to the market data service FactSet. Earnings are expected to slow this year, but still rise 9 percent in the first three months.

Strong earnings from Apple supported the market last week, easing fears that the tech industry’s period of fast growth may be coming to an end. Amazon and Alphabet, Google’s parent company, will publish their reports for the last three months ending December this week.

Another good sign: Sectors like financial stocks and industrials that are tied closely to the economy have done better than the market as a whole. Shares of General Electric, for instance, are down only about 2.5 percent since the start of the year. Wells Fargo’s stock price is up 2.5 percent in 2022.

“I don’t think there is a very big risk for a recession right now,” said James Paulsen, a strategist at Leuthold Group. “Then I don’t think it is a bull ender.”