Hi! Welcome to The Q3 Financial Quarterly!
Markets ended a very volatile Q3 in the green, driven by a much-anticipated interest rate cut and hope for the future. The S&P ended the quarter with its best year-to-date of the 21st century so far!1
Let's take a look at what happened in Q3 and what could drive markets in the final months of 2024.
Looking Back
How Did Markets Perform Last Quarter?
S&P 500
5.5%
The broader U.S. market turned in solid growth despite a volatile quarter.2
NASDAQ
2.6%
The tech-focused NASDAQ grew for the fourth quarter in a row.2
DOW 30
8.2%
The blue-chip Dow soared in Q3, setting new record closes.2
Looking Ahead
What Factors May Influence Markets in the Months to Come?
Let’s take a look ahead at some of the factors that we’ll be watching in the weeks and months ahead.
Interest rates
Now that the Federal Reserve has cut rates, analysts will be watching to see how quickly rates fall. Lower rates may support market growth, but deep cuts may trigger recession fears.3
Economic data
Investors will be closely watching economic data for hints about where the labor market, inflation, and business growth may be headed—and what the Fed may do next.
Recession indicators
Though an economic downturn does not seem imminent, there is still the risk that high interest rates might cause a recession in 2025.4
Elections & Politics
While markets have historically performed well regardless of who is in the White House, political uncertainty around the election may stoke volatility.5
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Bottom Line
Key Takeaways for Savvy Investors
Markets have had a bumpy but stellar ride in 2024.
So it’s likely that we’ll see volatility and some corrections ahead as traders sell and take profits.
However, there’s still reason to think the bulls can still run in 2024.
Much of the market story this year has been anticipating an end to high interest rates, and now that the Federal Reserve has cut rates, we can hope for a bump in business activity and economic growth.
However, if it looks like the Fed’s rate cut isn’t enough to stave off economic weakness, we may see a pullback.
Recession risks are still in the air, so there's still a chance we'll see a downturn in 2025. We’re watching data and trends closely.
Bottom line: We’re optimistic (but watchful) about where markets could go in the final months of 2024.
We’re staying flexible and looking for opportunities. If you have any questions or concerns shoot us an email at yourteam@news.tmfg.com or give us a call at (561) 353-3700.
Sources:
1. https://www.marketwatch.com/livecoverage/stock-market-today-dow-futures-dip-from-record-close/card/here-s-a-roundup-of-how-global-markets-fared-during-the-third-quarter-deutsche-bank-JSG0kSc3XsUu0RbPcJng
2. https://www.marketwatch.com/livecoverage/stock-market-today-dow-futures-dip-as-investors-await-key-economic-data
3. https://www.reuters.com/markets/us/fed-rate-cutting-cycle-could-be-shallower-than-expected-2024-09-18/
4. https://www.bankrate.com/banking/federal-reserve/economic-indicator-survey/?tpt=a#key-insights
5. https://www.fidelity.com/learning-center/trading-investing/election-market-impact
The S&P 500 is a stock index considered to be representative of the U.S. stock market in general. The NASDAQ Composite Index is an unmanaged composite index of over 2,500 common equities listed on the NASDAQ stock exchange. The Dow Jones Industrial Average is a price-weighted index that tracks 30 large, publicly traded American companies.
All index returns exclude reinvested dividends and interest. Indices are unmanaged and cannot be invested into directly.
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